sv3asr
As filed with the Securities and Exchange Commission on
April 8, 2010
Registration
No. 333-
UNITED STATES SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C.
20549
Form S-3
REGISTRATION
STATEMENT
UNDER
THE SECURITIES ACT OF
1933
TARGA RESOURCES PARTNERS
LP
TARGA RESOURCES PARTNERS
FINANCE CORPORATION
(Exact name of registrant as
specified in its charter)
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Delaware
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65-1295427
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Delaware
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32-0249658
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(State or other jurisdiction
of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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1000 Louisiana,
Suite 4300
Houston, Texas 77002
(713) 584-1000
(Address, including zip code,
and telephone number,
including area code, of registrants principal executive
offices)
Rene R. Joyce
Chief Executive
Officer
1000 Louisiana,
Suite 4300
Houston, Texas 77002
(713) 584-1000
(Name, address, including zip
code, and telephone number,
including area code, of agent
for service)
Copies to:
David P. Oelman
Christopher S. Collins
Vinson & Elkins
LLP
1001 Fannin Street,
Suite 2500
Houston, Texas 77002
(713) 758-2222
Approximate date of commencement of proposed sale to the
public: From time to time after the effective
date of this registration statement as determined by market
conditions and other factors.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans,
please check the following
box. o
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to
Rule 415 under the Securities Act of 1933, other than
securities offered only in connection with dividend or interest
reinvestment plans, check the following
box. þ
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act,
please check the following box and list the Securities Act
registration statement number of the earlier effective
registration statement for the same
offering. o
If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following
box and list the Securities Act registration statement number of
the earlier effective registration statement for the same
offering. o
If this Form is a registration statement pursuant to General
Instruction I.D. or a post-effective amendment thereto that
shall become effective upon filing with the Commission pursuant
to Rule 462(e) under the Securities Act, check the
following
box. þ
If this Form is a post-effective amendment to a registration
statement filed pursuant to General Instruction I.D. filed
to register additional securities or additional classes of
securities pursuant to Rule 413(b) under the Securities
Act, check the following
box. o
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated
filer, or a smaller reporting company. See the definitions of
large accelerated filer, accelerated
filer and smaller reporting company in
Rule 12b-2
of the Exchange Act. (Check one):
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Large accelerated
filer o
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Accelerated
filer þ
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Non-accelerated
filer o
(Do not check if a smaller reporting company)
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Smaller reporting
company o
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CALCULATION
OF REGISTRATION FEE
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Amount to be Registered/Proposed Maximum Offering Price
per
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Title of Each Class of
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Unit/Proposed Maximum Aggregate Offering Price per
Unit/Amount
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Securities to be Registered
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of Registration Fee(1)
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Common Units
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Debt Securities
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Total
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(1)
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An indeterminate aggregate initial
offering price or number of the securities of each identified
class is being registered as may from time to time be offered
hereunder at indeterminate prices. In accordance with
Rules 456(b) and 457(r) under the Securities Act of 1933,
the registrant is deferring payment of all of the registration
fee.
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PROSPECTUS
TARGA RESOURCES PARTNERS
LP
TARGA RESOURCES PARTNERS
FINANCE CORPORATION
Common Units
Debt Securities
Targa Resources Partners LP or selling unitholders may, in one
or more offerings, offer and sell common units representing
limited partner interests in Targa Resources Partners LP. Targa
Resources Partners LPs common units are listed for trading
on the New York Stock Exchange under the symbol NGLS.
Targa Resources Partners LP, together with Targa Resources
Partners Finance Corporation, may, in one or more offerings,
offer and sell the debt securities described in this prospectus
in one or more classes or series. We will provide information in
a supplement to this prospectus for the trading market, if any,
for any debt securities we may offer.
We or selling unitholders may offer and sell these securities
from time to time in amounts, at prices and on terms to be
determined by market conditions and other factors at the time of
our offerings. This prospectus describes only the general terms
of these securities and the general manner in which we or
selling unitholders will offer the securities. The specific
terms of any securities that we or selling unitholders offer
will be included in a supplement to this prospectus. The
prospectus supplement will describe the specific manner in which
we or selling unitholders will offer the securities, and also
may add, update or change information contained in this
prospectus. We or selling unitholders will sell these securities
through underwriters on a firm commitment basis. The names of
any underwriters and the specific terms of a plan of
distribution will be stated in the prospectus supplement.
Selling unitholders that are affiliates of Targa Resources
Partners LP may be deemed to be underwriters within
the meaning of the Securities Act of 1933, as amended, or the
Securities Act, and, as a result, may be deemed to be offering
securities, indirectly, on our behalf. We will not receive any
of the proceeds from the sale of the securities by selling
unitholders.
Investing in our common units and the debt securities
involves risks. Limited partnerships are inherently different
from corporations. You should carefully consider the risk
factors described under Risk Factors beginning on
page 1 of this prospectus before you make an investment in
our securities.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
The date of this prospectus is April 8, 2010.
TABLE OF
CONTENTS
In making your investment decision, you should rely only on
the information contained or incorporated by reference in this
prospectus or any prospectus supplement. We have not authorized
anyone to provide you with any other information. If anyone
provides you with different or inconsistent information, you
should not rely on it.
You should not assume that the information contained in this
prospectus or any prospectus supplement is accurate as of any
date other than the date on the front cover of those documents.
You should not assume that the information contained in the
documents incorporated by reference in this prospectus or any
prospectus supplement is accurate as of any date other than the
respective dates of those documents. Our business, financial
condition, results of operations and prospects may have changed
since those dates.
ABOUT
THIS PROSPECTUS
This prospectus is part of a registration statement on
Form S-3
that we filed with the Securities and Exchange Commission, or
SEC, using a shelf registration process. Under this
shelf registration process, we may, from time to time, offer and
sell any combination of the securities described in this
prospectus in one or more offerings and selling unitholders may,
from time to time, offer and sell common units of Targa
Resources Partners LP in one or more offerings. This prospectus
generally describes Targa Resources Partners LP and the
securities. Each time we or selling unitholders offer securities
with this prospectus, we will provide you with this prospectus
and a prospectus supplement that will contain specific
information about the terms of that offering. The prospectus
supplement may also add to, update or change information in this
prospectus. Before you invest in our securities, you should
carefully read this prospectus and any prospectus supplement and
the additional information described under the heading
Where You Can Find More Information. To the extent
information in this prospectus is inconsistent with information
contained in a prospectus supplement, you should rely on the
information in the prospectus supplement. You should read both
this prospectus and any prospectus supplement, together with
additional information described under the heading Where
You Can Find More Information, and any additional
information you may need to make your investment decision. All
references in this prospectus to we, us,
the Partnership and our refer to Targa
Resources Partners LP, together with its subsidiaries.
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TARGA
RESOURCES PARTNERS LP
We are a Delaware limited partnership formed on October 26,
2006 by Targa Resources, Inc. (Targa), a leading
provider of midstream natural gas and NGL services in the United
States, to own, operate, acquire and develop a diversified
portfolio of complementary midstream energy assets. We are
engaged in the business of gathering, compressing, treating,
processing and selling natural gas and fractionating and selling
natural gas liquids (NGLs) and NGL products. Our
gathering and processing assets are located in the
Fort Worth Basin/Bend Arch in North Texas, the Permian
Basin in West Texas and in Southwest Louisiana. Our NGL
logistics and marketing assets are located primarily at Mont
Belvieu and Galena Park near Houston, Texas and in Lake Charles,
Louisiana, with terminals and transportation assets across the
U.S.
We intend to leverage our relationship with Targa to acquire and
construct additional midstream energy assets and to utilize the
significant experience of Targas management team to
execute our strategy
Targa Resources Partners Finance Corporation was incorporated
under the laws of the State of Delaware on May 23, 2008, is
our wholly-owned subsidiary, and has no material assets or
liabilities. Its activities will be limited to co-issuing debt
securities and engaging in other activities incidental thereto.
Our principal executive offices are located at 1000 Louisiana
St., Suite 4300, Houston, Texas 77002, and our telephone
number at that location is
(713) 584-1000.
For additional information as to our business, properties and
financial condition, please refer to the documents cited in
Where You Can Find More Information.
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CAUTIONARY
STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
Our reports, filings and other public announcements may from
time to time contain statements that do not directly or
exclusively relate to historical facts. Such statements are
forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. You can
typically identify forward-looking statements by the use of
forward-looking words, such as may,
could, project, believe,
anticipate, expect,
estimate, potential, plan,
forecast and other similar words.
All statements that are not statements of historical facts,
including statements regarding our future financial position,
business strategy, budgets, projected costs and plans and
objectives of management for future operations, are
forward-looking statements.
These forward-looking statements reflect our intentions, plans,
expectations, assumptions and beliefs about future events and
are subject to risks, uncertainties and other factors, many of
which are outside our control. Important factors that could
cause actual results to differ materially from the expectations
expressed or implied in the forward-looking statements include
known and unknown risks. Known risks and uncertainties include,
but are not limited to, the risks set forth in Risk
Factors as well as the following risks and uncertainties:
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our ability to access the debt and equity markets, which will
depend on general market conditions and the credit ratings for
our debt obligations;
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the amount of collateral required to be posted from time to time
in our transactions;
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our success in risk management activities, including the use of
derivative financial instruments to hedge commodity and interest
rate risks;
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the level of creditworthiness of counterparties to transactions;
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changes in laws and regulations, particularly with regard to
taxes, safety and protection of the environment;
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the timing and extent of changes in natural gas, NGLs and
commodity prices, interest rates and demand for our services;
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weather and other natural phenomena;
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industry changes, including the impact of consolidations and
changes in competition;
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our ability to obtain necessary licenses, permits and other
approvals;
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the level and success of oil and natural gas drilling around our
assets, and our success in connecting natural gas supplies to
our gathering and processing systems, and NGL supplies to our
logistics and marketing facilities;
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our ability to grow through acquisitions or internal growth
projects, and the successful integration and future performance
of such assets;
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general economic, market and business conditions; and
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the risks described elsewhere in this prospectus.
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Although we believe that the assumptions underlying our
forward-looking statements are reasonable, any of the
assumptions could be inaccurate, and, therefore, we cannot
assure you that the forward-looking statements included in this
prospectus will prove to be accurate. Some of these and other
risks and uncertainties that could cause actual results to
differ materially from such forward-looking statements are more
fully described under the heading Risk Factors in this
prospectus. Except as may be required by applicable law, we
undertake no obligation to publicly update or advise of any
change in any forward-looking statement, whether as a result of
new information, future events or otherwise.
Forward-looking statements contained in this prospectus and all
subsequent written and oral forward-looking statements
attributable to us or persons acting on our behalf are expressly
qualified in their entirety by this cautionary statement.
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RISK
FACTORS
An investment in our securities involves a high degree of risk.
You should carefully consider the risk factors and all of the
other information included in, or incorporated by reference
into, this prospectus in evaluating an investment in our
securities. If any of these risks were to occur, our business,
financial condition or results of operations could be adversely
affected. In that case, the trading price of our common units or
debt securities could decline and you could lose all or part of
your investment. When we offer and sell any securities pursuant
to a prospectus supplement, we may include additional risk
factors relevant to such securities in the prospectus supplement.
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USE OF
PROCEEDS
Except as otherwise provided in the applicable prospectus
supplement, we will use the net proceeds we receive from the
sale of the securities for general partnership purposes, which
may include repayment of indebtedness, the acquisition of
businesses, other capital expenditures and additions to working
capital.
Any specific allocation of the net proceeds of an offering of
securities to a specific purpose will be determined at the time
of the offering and will be described in a prospectus supplement.
We will not receive any of the proceeds from the sale of common
units by selling unitholders.
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RATIO OF
EARNINGS TO FIXED CHARGES
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Years Ended December 31,
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2009
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2008
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2007
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2006
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2005
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Ratio of earnings to fixed charges
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1.6
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1.5
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1.4
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(1
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1.4
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(1)
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For the year ended
December 31, 2006, our ratio was less than 1:1. Additional
earnings of $21.0 million would have been needed to achieve
coverage of 1:1 for the year ended December 31, 2006.
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For purposes of computing the ratios of earnings to fixed
charges, earnings consist of pre-tax income from continuing
operations before equity in (earnings) loss from unconsolidated
affiliates plus fixed charges, amortization of capitalized
interest and distributions from equity investees less
capitalized interest. Fixed charges consist of interest expensed
and capitalized and the estimated interest component of rent
expense.
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DESCRIPTION
OF OUR COMMON UNITS
The
Common Units
The holders of our common units are entitled to participate in
partnership distributions and exercise the rights and privileges
available to limited partners under our partnership agreement.
For a description of the rights of holders of our common units
to partnership distributions, please see this section and
Cash Distribution Policy. For a description of the
rights and privileges of limited partners under our partnership
agreement, including voting rights, please see The
Partnership Agreement.
Transfer
Agent and Registrar
Duties. Computershare Investor Services, LLC
serves as registrar and transfer agent for our common units. We
pay all fees charged by the transfer agent for transfers of
common units except the following that must be paid by
unitholders:
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surety bond premiums to replace lost or stolen certificates,
taxes and other governmental charges;
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special charges for services requested by a common
unitholder; and
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other similar fees or charges.
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There is no charge to unitholders for disbursements of our cash
distributions. We have indemnified the transfer agent, its
agents and each of their stockholders, directors, officers and
employees against all claims and losses that may arise out of
acts performed or omitted for its activities in that capacity,
except for any liability due to any gross negligence or
intentional misconduct of the indemnified person or entity.
Resignation or Removal. The transfer agent may
resign, by notice to us, or be removed by us. The resignation or
removal of the transfer agent will become effective upon our
appointment of a successor transfer agent and registrar and its
acceptance of the appointment. If no successor has been
appointed and has accepted the appointment within 30 days
after notice of the resignation or removal, our general partner
may act as the transfer agent and registrar until a successor is
appointed.
Transfer
of Common Units
By transfer of common units in accordance with our partnership
agreement, each transferee of common units shall be admitted as
a limited partner with respect to the common units transferred
when such transfer and admission is reflected in our books and
records. Each transferee:
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represents that the transferee has the capacity, power and
authority to become bound by our partnership agreement;
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automatically agrees to be bound by the terms and conditions of,
and is deemed to have executed, our partnership
agreement; and
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gives the consents and approvals contained in our partnership
agreement, such as the approval of all transactions and
agreements that we are entering into in connection with this
offering.
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A transferee will become a substituted limited partner of our
partnership for the transferred common units automatically upon
the recording of the transfer on our books and records.
We may, at our discretion, treat the nominee holder of a common
unit as the absolute owner. In that case, the beneficial
holders rights are limited solely to those that it has
against the nominee holder as a result of any agreement between
the beneficial owner and the nominee holder.
Common units are securities and are transferable according to
the laws governing transfers of securities. In addition to other
rights acquired upon transfer, the transferor gives the
transferee the right to become a substituted limited partner in
our partnership for the transferred common units.
Until a common unit has been transferred on our books, we and
the transfer agent may treat the record holder of the unit as
the absolute owner for all purposes, except as otherwise
required by law or stock exchange regulations.
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THE
PARTNERSHIP AGREEMENT
The following is a summary of the material provisions of our
partnership agreement.
We summarize the following provisions of our partnership
agreement elsewhere in this prospectus:
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with regard to distributions of available cash, please see
Cash Distribution Policy;
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with regard to the transfer of our common units, please see
Description of our Common Units Transfer of
Common Units; and
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with regard to allocations of taxable income and taxable loss,
please see Material Income Tax Consequences.
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Organization
and Duration
Our partnership was organized on October 23, 2006 and will
have a perpetual existence unless terminated pursuant to the
terms of our partnership agreement.
Purpose
Our purpose under the partnership agreement is limited to any
business activity that is approved by our general partner and
that lawfully may be conducted by a limited partnership
organized under Delaware law; provided, that our general partner
shall not cause us to engage, directly or indirectly, in any
business activity that the general partner determines would
cause us to be treated as an association taxable as a
corporation or otherwise taxable as an entity for federal income
tax purposes.
Power of
Attorney
Each limited partner, and each person who acquires a unit from a
unitholder, by accepting the common unit, automatically grants
to our general partner and, if appointed, a liquidator, a power
of attorney to, among other things, execute and file documents
required for our qualification, continuance or dissolution. The
power of attorney also grants our general partner the authority
to amend, and to make consents and waivers under, our
partnership agreement.
Cash
Distributions
Our partnership agreement specifies the manner in which we make
cash distributions to holders of our common units and other
partnership securities as well as to our general partner in
respect of its general partner interest and its incentive
distribution rights. For a description of these cash
distribution provisions, please see Cash Distribution
Policy.
Capital
Contributions
Unitholders are not obligated to make additional capital
contributions, except as described below under
Limited Liability.
Our general partner has the right, but not the obligation, to
contribute a proportionate amount of capital to us to maintain
its 2% general partner interest if we issue additional units.
Our general partners 2% interest, and the percentage of
our cash distributions to which it is entitled, will be
proportionately reduced if we issue additional units in the
future and our general partner does not contribute a
proportionate amount of capital to us to maintain its 2% general
partner interest. Our general partner will be entitled to make a
capital contribution in order to maintain its 2% general partner
interest in the form of the contribution to us of common units
based on the current market value of the contributed common
units.
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Voting
Rights
The following is a summary of the unitholder vote required for
the matters specified below. Matters requiring the approval of a
unit majority require the approval of a majority of
our common units and Class B units, if any, voting as a
class.
In voting their common units and Class B units, our general
partner and its affiliates will have no fiduciary duty or
obligation whatsoever to us or the limited partners, including
any duty to act in good faith or in the best interests of us or
the limited partners.
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Issuance of additional units |
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No approval right |
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Amendment of the partnership agreement |
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Certain amendments may be made by the general partner without
the approval of the unitholders. Other amendments generally
require the approval of a unit majority. Please see
Amendment of the Partnership Agreement. |
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Merger of our partnership or the sale of all or substantially
all of our assets |
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Unit majority in certain circumstances. Please see
Merger, Consolidation, Conversion, Sale or
Other Disposition of Assets. |
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Dissolution of our partnership |
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Unit majority. Please see Termination and
Dissolution. |
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Continuation of our business upon dissolution |
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Unit majority. Please see Termination and
Dissolution. |
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Withdrawal of the general partner |
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Under most circumstances, the approval of a majority of our
common units, excluding common units held by our general partner
and its affiliates, is required for the withdrawal of our
general partner prior to December 31, 2016 in a manner that
would cause a dissolution of our partnership. Please see
Withdrawal or Removal of the General
Partner. |
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Removal of the general partner |
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Not less than
662/3%
of the outstanding units, voting as a single class, including
units held by our general partner and its affiliates. Please see
Withdrawal or Removal of the General
Partner. |
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Transfer of the general partner interest |
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Our general partner may transfer all, but not less than all, of
its general partner interest in us without a vote of our
unitholders to an affiliate or another person in connection with
its merger or consolidation with or into, or sale of all or
substantially all of its assets, to such person. The approval of
a majority of our common units, excluding common units held by
the general partner and its affiliates, is required in other
circumstances for a transfer of the general partner interest to
a third party prior to December 31, 2016. See
Transfer of General Partner Units. |
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Transfer of incentive distribution rights |
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Except for transfers to an affiliate or another person as part
of our general partners merger or consolidation, sale of
all or substantially all of its assets or the sale of all of the
ownership interests in such holder, the approval of a majority
of our common units, excluding common units held by the general
partner and its affiliates, is required in most circumstances
for a transfer of the incentive distribution rights to a third
party prior to December 31, 2016. Please see
Transfer of Incentive Distribution
Rights. |
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Transfer of ownership interests in our general partner |
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No approval required at any time. Please see
Transfer of Ownership Interests in the
General Partner. |
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Limited
Liability
Assuming that a limited partner does not participate in the
control of our business within the meaning of the Delaware Act
and that he otherwise acts in conformity with the provisions of
the partnership agreement, his liability under the Delaware Act
will be limited, subject to possible exceptions, to the amount
of capital he is obligated to contribute to us for his common
units plus his share of any undistributed profits and assets. If
it were determined, however, that the right, or exercise of the
right, by the limited partners as a group:
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to remove or replace the general partner;
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to approve some amendments to the partnership agreement; or
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to take other action under the partnership agreement,
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constituted participation in the control of our
business for the purposes of the Delaware Act, then the limited
partners could be held personally liable for our obligations
under the laws of Delaware, to the same extent as the general
partner. This liability would extend to persons who transact
business with us who reasonably believe that the limited partner
is a general partner. Neither the partnership agreement nor the
Delaware Act specifically provides for legal recourse against
the general partner if a limited partner were to lose limited
liability through any fault of the general partner. While this
does not mean that a limited partner could not seek legal
recourse, we know of no precedent for this type of a claim in
Delaware case law.
Under the Delaware Act, a limited partnership may not make a
distribution to a partner if, after the distribution, all
liabilities of the limited partnership, other than liabilities
to partners on account of their partnership interests and
liabilities for which the recourse of creditors is limited to
specific property of the partnership, would exceed the fair
value of the assets of the limited partnership. For the purpose
of determining the fair value of the assets of a limited
partnership, the Delaware Act provides that the fair value of
property subject to liability for which recourse of creditors is
limited shall be included in the assets of the limited
partnership only to the extent that the fair value of that
property exceeds the nonrecourse liability. The Delaware Act
provides that a limited partner who receives a distribution and
knew at the time of the distribution that the distribution was
in violation of the Delaware Act shall be liable to the limited
partnership for the amount of the distribution for three years.
Under the Delaware Act, a substituted limited partner of a
limited partnership is liable for the obligations of his
assignor to make contributions to the partnership, except that
such person is not obligated for liabilities unknown to him at
the time he became a limited partner and that could not be
ascertained from the partnership agreement.
Our subsidiaries conduct business in Texas and Louisiana, as
well as other states. Maintenance of our limited liability as a
limited partner of Targa Resources Operating LP (the
Operating Partnership), may require compliance with
legal requirements in the jurisdictions in which the Operating
Partnership conducts business, including qualifying our
subsidiaries to do business there.
Limitations on the liability of limited partners for the
obligations of a limited partner have not been clearly
established in many jurisdictions. If, by virtue of our
partnership interest in the Operating Partnership or otherwise,
it were determined that we were conducting business in any state
without compliance with the applicable limited partnership or
limited liability company statute, or that the right or exercise
of the right by the limited partners as a group to remove or
replace the general partner, to approve some amendments to the
partnership agreement, or to take other action under the
partnership agreement constituted participation in the
control of our business for purposes of the statutes of
any relevant jurisdiction, then the limited partners could be
held personally liable for our obligations under the law of that
jurisdiction to the same extent as the general partner under the
circumstances. We will operate in a manner that the general
partner considers reasonable and necessary or appropriate to
preserve the limited liability of the limited partners.
Issuance
of Additional Securities
Our partnership agreement authorizes us to issue an unlimited
number of additional partnership securities for the
consideration and on the terms and conditions determined by our
general partner without the approval of the unitholders.
7
It is possible that we will fund acquisitions through the
issuance of additional common units or other partnership
securities. Holders of any additional common units we issue will
be entitled to share equally with the then-existing holders of
common units in our distributions of available cash. In
addition, the issuance of additional common units or other
partnership securities may dilute the value of the interests of
the then-existing holders of common units in our net assets.
In accordance with Delaware law and the provisions of our
partnership agreement, we may also issue additional partnership
securities that, as determined by our general partner, may have
special voting rights to which our common units are not
entitled. In addition, our partnership agreement does not
prohibit the issuance by our subsidiaries of equity securities,
which may effectively rank senior to our common units.
Upon the issuance of additional partnership securities, our
general partner will be entitled, but not required, to make
additional capital contributions to the extent necessary to
maintain its 2% general partner interest in us. Our general
partners 2% interest in us will be reduced if we issue
additional units in the future (other than the issuance of units
issued in connection with a reset of the incentive distribution
target levels relating to our general partners incentive
distribution rights or the issuance of units upon conversion of
outstanding partnership securities) and our general partner does
not contribute a proportionate amount of capital to us to
maintain its 2% general partner interest. Moreover, our general
partner will have the right, which it may from time to time
assign in whole or in part to any of its affiliates, to purchase
common units or other partnership securities whenever, and on
the same terms that, we issue those securities to persons other
than our general partner and its affiliates, to the extent
necessary to maintain the percentage interest of the general
partner and its affiliates, including such interest represented
by common units that existed immediately prior to each issuance.
The holders of common units will not have preemptive rights to
acquire additional common units or other partnership securities.
Amendment
of the Partnership Agreement
General. Amendments to our partnership
agreement may be proposed only by or with the consent of our
general partner. However, our general partner will have no duty
or obligation to propose any amendment and may decline to do so
free of any fiduciary duty or obligation whatsoever to us or the
limited partners, including any duty to act in good faith or in
the best interests of us or the limited partners. In order to
adopt a proposed amendment, other than the amendments discussed
below, our general partner is required to seek written approval
of the holders of the number of units required to approve the
amendment or call a meeting of the limited partners to consider
and vote upon the proposed amendment. Except as described below,
an amendment must be approved by a unit majority.
Prohibited Amendments. No amendment may be
made that would:
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enlarge the obligations of any limited partner without its
consent, unless approved by at least a majority of the type or
class of limited partner interests so affected; or
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enlarge the obligations of, restrict in any way any action by or
rights of, or reduce in any way the amounts distributable,
reimbursable or otherwise payable by us to our general partner
or any of its affiliates without the consent of our general
partner, which consent may be given or withheld at its option.
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The provision of our partnership agreement preventing the
amendments having the effects described in any of the clauses
above can be amended upon the approval of the holders of at
least 90% of the outstanding units voting together as a single
class (including units owned by our general partner and its
affiliates).
No Unitholder Approval. Our general partner
may generally make amendments to our partnership agreement
without the approval of any limited partner or assignee to
reflect:
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a change in our name, the location of our principal place of our
business, our registered agent or our registered office;
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the admission, substitution, withdrawal or removal of partners
in accordance with our partnership agreement;
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a change that our general partner determines to be necessary or
appropriate to qualify or continue our qualification as a
limited partnership or a partnership in which the limited
partners have limited liability under the laws of any state or
to ensure that neither we nor the Operating Partnership nor any
of its subsidiaries will be treated as an association taxable as
a corporation or otherwise taxed as an entity for federal income
tax purposes;
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a change in our fiscal year and related changes;
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an amendment that is necessary, in the opinion of our counsel,
to prevent us or our general partner or the directors, officers,
agents or trustees of our general partner from in any manner
being subjected to the provisions of the Investment Company Act
of 1940, the Investment Advisors Act of 1940, or plan
asset regulations adopted under the Employee Retirement
Income Security Act of 1974, or ERISA, whether or not
substantially similar to plan asset regulations currently
applied or proposed;
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an amendment that our general partner determines to be necessary
or appropriate for the authorization of additional partnership
securities or rights to acquire partnership securities,
including any amendment that our general partner determines is
necessary or appropriate in connection with:
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the adjustments of the minimum quarterly distribution, first
target distribution, second target distribution and third target
distribution in connection with the reset of our general
partners incentive distribution rights as described under
Cash Distribution Policy General
Partners Right to Reset Incentive Distribution
Levels;
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the implementation of the provisions relating to our general
partners right to reset its incentive distribution rights
in exchange for Class B units; or
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any modification of the incentive distribution rights made in
connection with the issuance of additional partnership
securities or rights to acquire partnership securities, provided
that, any such modifications and related issuance of partnership
securities have received approval by a majority of the members
of the conflicts committee of our general partner;
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any amendment expressly permitted in our partnership agreement
to be made by our general partner acting alone;
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an amendment effected, necessitated or contemplated by a merger
agreement that has been approved under the terms of our
partnership agreement;
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any amendment that our general partner determines to be
necessary or appropriate for the formation by us of, or our
investment in, any corporation, partnership or other entity, as
otherwise permitted by our partnership agreement;
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conversions into, mergers with or conveyances to another limited
liability entity that is newly formed and has no assets,
liabilities or operations at the time of the conversion, merger
or conveyance other than those it receives by way of the
conversion, merger or conveyance; or
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any other amendments substantially similar to any of the matters
described in the clauses above.
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In addition, our general partner may make amendments to our
partnership agreement without the approval of any limited
partner if our general partner determines that those amendments:
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do not adversely affect the limited partners (or any particular
class of limited partners) in any material respect;
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are necessary or appropriate to satisfy any requirements,
conditions or guidelines contained in any opinion, directive,
order, ruling or regulation of any federal or state agency or
judicial authority or contained in any federal or state statute;
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are necessary or appropriate to facilitate the trading of
limited partner interests or to comply with any rule,
regulation, guideline or requirement of any securities exchange
on which the limited partner interests are or will be listed for
trading;
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are necessary or appropriate for any action taken by our general
partner relating to splits or combinations of units under the
provisions of our partnership agreement; or
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are required to effect the intent expressed in this prospectus
or the intent of the provisions of our partnership agreement or
are otherwise contemplated by our partnership agreement.
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Opinion of Counsel and Unitholder
Approval. For amendments of the type not
requiring unitholder approval, our general partner will not be
required to obtain an opinion of counsel that an amendment will
not result in a loss of limited liability to the limited
partners or result in our being treated as an association
taxable as a corporation or otherwise taxable as an entity for
federal income tax purposes in connection with any of the
amendments. No amendments to our partnership agreement other
than those described above under No Unitholder
Approval will become effective without the approval of
holders of at least 90% of the outstanding units voting as a
single class unless we first obtain an opinion of counsel to the
effect that the amendment will not affect the limited liability
under applicable law of any of our limited partners.
In addition to the above restrictions, any amendment that would
have a material adverse effect on the rights or preferences of
any type or class of outstanding units in relation to other
classes of units will require the approval of at least a
majority of the type or class of units so affected. Any
amendment that reduces the voting percentage required to take
any action is required to be approved by the affirmative vote of
limited partners whose aggregate outstanding units constitute
not less than the voting requirement sought to be reduced.
Merger,
Consolidation, Conversion, Sale or Other Disposition of
Assets
A merger, consolidation or conversion of us requires the prior
consent of our general partner. However, our general partner
will have no duty or obligation to consent to any merger,
consolidation or conversion and may decline to do so free of any
fiduciary duty or obligation whatsoever to us or the limited
partners, including any duty to act in good faith or in the best
interest of us or the limited partners.
In addition, the partnership agreement generally prohibits our
general partner without the prior approval of the holders of a
unit majority, from causing us to, among other things, sell,
exchange or otherwise dispose of all or substantially all of our
assets in a single transaction or a series of related
transactions, including by way of merger, consolidation or other
combination, or approving on our behalf the sale, exchange or
other disposition of all or substantially all of the assets of
our subsidiaries. Our general partner may, however, mortgage,
pledge, hypothecate or grant a security interest in all or
substantially all of our assets without that approval. Our
general partner may also sell all or substantially all of our
assets under a foreclosure or other realization upon those
encumbrances without that approval. Finally, our general partner
may consummate any merger without the prior approval of our
unitholders if we are the surviving entity in the transaction,
our general partner has received an opinion of counsel regarding
limited liability and tax matters, the transaction would not
result in a material amendment to the partnership agreement,
each of our units will be an identical unit of our partnership
following the transaction, and the partnership securities to be
issued do not exceed 20% of our outstanding partnership
securities immediately prior to the transaction.
If the conditions specified in the partnership agreement are
satisfied, our general partner may convert us or any of our
subsidiaries into a new limited liability entity or merge us or
any of our subsidiaries into, or convey all of our assets to, a
newly formed entity if the sole purpose of that conversion,
merger or conveyance is to effect a mere change in our legal
form into another limited liability entity, our general partner
has received an opinion of counsel regarding limited liability
and tax matters, and the governing instruments of the new entity
provide the limited partners and the general partner with the
same rights and obligations as contained in the partnership
agreement. The unitholders are not entitled to dissenters
rights of appraisal under the partnership agreement or
applicable Delaware law in the event of a conversion, merger or
consolidation, a sale of substantially all of our assets or any
other similar transaction or event.
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Termination
and Dissolution
We will continue as a limited partnership until terminated under
our partnership agreement. We will dissolve upon:
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the election of our general partner to dissolve us, if approved
by the holders of units representing a unit majority;
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there being no limited partners, unless we are continued without
dissolution in accordance with applicable Delaware law;
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the entry of a decree of judicial dissolution of our
partnership; or
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the withdrawal or removal of our general partner or any other
event that results in its ceasing to be our general partner
other than by reason of a transfer of its general partner
interest in accordance with our partnership agreement or
withdrawal or removal following approval and admission of a
successor.
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Upon a dissolution under the last clause above, the holders of a
unit majority may also elect, within specific time limitations,
to continue our business on the same terms and conditions
described in our partnership agreement by appointing as a
successor general partner an entity approved by the holders of
units representing a unit majority, subject to our receipt of an
opinion of counsel to the effect that:
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the action would not result in the loss of limited liability of
any limited partner; and
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neither our partnership, the Operating Partnership nor any of
our other subsidiaries would be treated as an association
taxable as a corporation or otherwise be taxable as an entity
for federal income tax purposes upon the exercise of that right
to continue.
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Liquidation
and Distribution of Proceeds
Upon our dissolution, unless we are continued as a new limited
partnership, the liquidator authorized to wind up our affairs
will, acting with all of the powers of our general partner that
are necessary or appropriate, liquidate our assets and apply the
proceeds of the liquidation as described in Cash
Distribution Policy Distributions of Cash Upon
Liquidation. The liquidator may defer liquidation or
distribution of our assets for a reasonable period of time or
distribute assets to partners in kind if it determines that a
sale would be impractical or would cause undue loss to our
partners.
Withdrawal
or Removal of the General Partner
Except as described below, our general partner has agreed not to
withdraw voluntarily as our general partner prior to
December 31, 2016 without obtaining the approval of the
holders of at least a majority of the outstanding common units,
excluding common units held by the general partner and its
affiliates, and furnishing an opinion of counsel regarding
limited liability and tax matters. On or after December 31,
2016, our general partner may withdraw as general partner
without first obtaining approval of any unitholder by giving
90 days written notice, and that withdrawal will not
constitute a violation of our partnership agreement.
Notwithstanding the information above, our general partner may
withdraw without unitholder approval upon 90 days
notice to the limited partners if at least 50% of the
outstanding common units are held or controlled by one person
and its affiliates other than the general partner and its
affiliates. In addition, the partnership agreement permits our
general partner in some instances to sell or otherwise transfer
all of its general partner interest in us without the approval
of the unitholders. Please see Transfer of
General Partner Units and Transfer of
Incentive Distribution Rights.
Upon withdrawal of our general partner under any circumstances,
other than as a result of a transfer by our general partner of
all or a part of its general partner interest in us, the holders
of a unit majority, voting as separate classes, may select a
successor to that withdrawing general partner. If a successor is
not elected, or is elected but an opinion of counsel regarding
limited liability and tax matters cannot be obtained, we will be
dissolved, wound up and liquidated, unless within a specified
period after that withdrawal, the holders of a
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unit majority agree in writing to continue our business and to
appoint a successor general partner. Please see
Termination and Dissolution.
Our general partner may not be removed unless that removal is
approved by the vote of the holders of not less than
662/3%
of the outstanding units, voting together as a single class,
including units held by our general partner and its affiliates,
and we receive an opinion of counsel regarding limited liability
and tax matters. Any removal of our general partner is also
subject to the approval of a successor general partner by the
vote of the holders of a majority of the outstanding common
units and Class B units, if any, voting as separate
classes. The ownership of more than
331/3%
of the outstanding units by our general partner and its
affiliates would give them the practical ability to prevent our
general partners removal.
Our partnership agreement also provides that if our general
partner is removed as our general partner under circumstances
where cause does not exist and units held by the general partner
and its affiliates are not voted in favor of that removal our
general partner will have the right to convert its general
partner interest and its incentive distribution rights into
common units or to receive cash in exchange for those interests
based on the fair market value of those interests at that time.
In the event of removal of a general partner under circumstances
where cause exists or withdrawal of a general partner where that
withdrawal violates our partnership agreement, a successor
general partner will have the option to purchase the general
partner interest and incentive distribution rights of the
departing general partner for a cash payment equal to the fair
market value of those interests. Under all other circumstances
where a general partner withdraws or is removed by the limited
partners, the departing general partner will have the option to
require the successor general partner to purchase the general
partner interest of the departing general partner and its
incentive distribution rights for fair market value. In each
case, this fair market value will be determined by agreement
between the departing general partner and the successor general
partner. If no agreement is reached, an independent investment
banking firm or other independent expert selected by the
departing general partner and the successor general partner will
determine the fair market value. Or, if the departing general
partner and the successor general partner cannot agree upon an
expert, then an expert chosen by agreement of the experts
selected by each of them will determine the fair market value.
If the option described above is not exercised by either the
departing general partner or the successor general partner, the
departing general partner interest and its incentive
distribution rights will automatically convert into common units
equal to the fair market value of those interests as determined
by an investment banking firm or other independent expert
selected in the manner described in the preceding paragraph.
In addition, we are required to reimburse the departing general
partner for all amounts due the departing general partner,
including, without limitation, all employee-related liabilities,
including severance liabilities, incurred for the termination of
any employees employed by the departing general partner or its
affiliates for our benefit.
Transfer
of General Partner Units
Except for transfer by our general partner of all, but not less
than all, of its general partner units to:
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an affiliate of our general partner (other than an
individual); or
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another entity as part of the merger or consolidation of our
general partner with or into another entity or the transfer by
our general partner of all or substantially all of its assets to
another entity,
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our general partner may not transfer all or any of its general
partner units to another person prior to December 31, 2016
without the approval of the holders of at least a majority of
the outstanding common units, excluding common units held by our
general partner and its affiliates. As a condition of this
transfer, the transferee must assume, among other things, the
rights and duties of our general partner, agree to be bound by
the provisions of our partnership agreement, and furnish an
opinion of counsel regarding limited liability and tax matters.
Our general partner and its affiliates may at any time, transfer
units to one or more persons, without unitholder approval.
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Transfer
of Ownership Interests in the General Partner
At any time, Targa may sell or transfer all or part of their
membership interests in our general partner to an affiliate or
third party without the approval of our unitholders.
Transfer
of Incentive Distribution Rights
Our general partner or its affiliates or a subsequent holder may
transfer its incentive distribution rights to an affiliate of
the holder (other than an individual) or another entity as part
of the merger or consolidation of such holder with or into
another entity, the sale of all of the ownership interest in the
holder or the sale of all or substantially all of its assets to,
that entity without the prior approval of the unitholders. Prior
to December 31, 2016, other transfers of incentive
distribution rights will require the affirmative vote of holders
of a majority of the outstanding common units, excluding common
units held by our general partner and its affiliates. On or
after December 31, 2016, the incentive distribution rights
will be freely transferable.
Change of
Management Provisions
Our partnership agreement contains specific provisions that are
intended to discourage a person or group from attempting to
remove our general partner or otherwise change the management of
our general partner. If any person or group other than our
general partner and its affiliates acquires beneficial ownership
of 20% or more of any class of units, that person or group loses
voting rights on all of its units. This loss of voting rights
does not apply to any person or group that acquires the units
from our general partner or its affiliates and any transferees
of that person or group approved by our general partner or to
any person or group who acquires the units with the prior
approval of the board of directors of our general partner.
Our partnership agreement also provides that if our general
partner is removed as our general partner under circumstances
where cause does not exist and units held by our general partner
and its affiliates are not voted in favor of that removal our
general partner will have the right to convert its general
partner units and its incentive distribution rights into common
units or to receive cash in exchange for those interests based
on the fair market value of those interests at that time.
Limited
Call Right
If at any time our general partner and its affiliates own more
than 80% of the then-issued and outstanding limited partner
interests of any class, our general partner will have the right,
which it may assign in whole or in part to any of its affiliates
or to us, to acquire all, but not less than all, of the limited
partner interests of the class held by unaffiliated persons as
of a record date to be selected by our general partner, on at
least 10 but not more than 60 days notice. The purchase
price in the event of this purchase is the greater of:
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the highest price paid by either of our general partner or any
of its affiliates for any limited partner interests of the class
purchased within the 90 days preceding the date on which
our general partner first mails notice of its election to
purchase those limited partner interests; and
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the current market price as of the date three days before the
date the notice is mailed.
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As a result of our general partners right to purchase
outstanding limited partner interests, a holder of limited
partner interests may have his limited partner interests
purchased at a price that may be lower than market prices at
various times prior to such purchase or lower than a unitholder
may anticipate the market price to be in the future. The tax
consequences to a unitholder of the exercise of this call right
are the same as a sale by that unitholder of his common units in
the market. Please see Material Income Tax
Consequences Disposition of Common Units.
Meetings;
Voting
Except as described below regarding a person or group owning 20%
or more of any class of units then outstanding, record holders
of units on the record date will be entitled to notice of, and
to vote at, meetings of our limited partners and to act upon
matters for which approvals may be solicited.
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Our general partner does not anticipate that any meeting of
unitholders will be called in the foreseeable future. Any action
that is required or permitted to be taken by the unitholders may
be taken either at a meeting of the unitholders or without a
meeting if consents in writing describing the action so taken
are signed by holders of the number of units necessary to
authorize or take that action at a meeting. Meetings of the
unitholders may be called by our general partner or by
unitholders owning at least 20% of the outstanding units of the
class for which a meeting is proposed. Unitholders may vote
either in person or by proxy at meetings. The holders of a
majority of the outstanding units of the class or classes for
which a meeting has been called represented in person or by
proxy will constitute a quorum unless any action by the
unitholders requires approval by holders of a greater percentage
of the units, in which case the quorum will be the greater
percentage.
Each record holder of a unit has a vote according to his
percentage interest in us, although additional limited partner
interests having special voting rights could be issued. Please
see Issuance of Additional Securities.
However, if at any time any person or group, other than our
general partner and its affiliates, or a direct or subsequently
approved transferee of our general partner or its affiliates,
acquires, in the aggregate, beneficial ownership of 20% or more
of any class of units then outstanding, that person or group
will lose voting rights on all of its units and the units may
not be voted on any matter and will not be considered to be
outstanding when sending notices of a meeting of unitholders,
calculating required votes, determining the presence of a quorum
or for other similar purposes. Common units held in nominee or
street name account will be voted by the broker or other nominee
in accordance with the instruction of the beneficial owner
unless the arrangement between the beneficial owner and his
nominee provides otherwise.
Any notice, demand, request, report or proxy material required
or permitted to be given or made to record holders of common
units under our partnership agreement will be delivered to the
record holder by us or by the transfer agent.
Status as
Limited Partner
By transfer of common units in accordance with our partnership
agreement, each transferee of common units shall be admitted as
a limited partner with respect to the common units transferred
when such transfer and admission is reflected in our books and
records. Except as described under
Limited Liability, the common
units will be fully paid, and unitholders will not be required
to make additional contributions.
Non-Citizen
Assignees; Redemption
If we are or become subject to federal, state or local laws or
regulations that, in the reasonable determination of our general
partner, create a substantial risk of cancellation or forfeiture
of any property that we have an interest in because of the
nationality, citizenship or other related status of any limited
partner, we may redeem the units held by the limited partner at
their current market price. In order to avoid any cancellation
or forfeiture, our general partner may require each limited
partner to furnish information about his nationality,
citizenship or related status. If a limited partner fails to
furnish information about his nationality, citizenship or other
related status within 30 days after a request for the
information or our general partner determines after receipt of
the information that the limited partner is not an eligible
citizen, the limited partner may be treated as a non-citizen
assignee. A non-citizen assignee is entitled to an interest
equivalent to that of a limited partner for the right to share
in allocations and distributions from us, including liquidating
distributions. A non-citizen assignee does not have the right to
direct the voting of his units and may not receive distributions
in-kind upon our liquidation.
Indemnification
Under our partnership agreement, in most circumstances, we will
indemnify the following persons, to the fullest extent permitted
by law, from and against all losses, claims, damages or similar
events:
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our general partner;
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any departing general partner;
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any person who is or was an affiliate of a general partner or
any departing general partner;
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any person who is or was a director, officer, member, partner,
fiduciary or trustee of any entity set forth in the preceding
three bullet points;
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any person who is or was serving as director, officer, member,
partner, fiduciary or trustee of another person at the request
of our general partner, any departing general partner, an
affiliate of our general partner or an affiliate of any
departing general partner; and
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any person designated by our general partner.
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Any indemnification under these provisions will only be out of
our assets. Unless it otherwise agrees, our general partner will
not be personally liable for, or have any obligation to
contribute or lend funds or assets to us to enable us to
effectuate, indemnification. We may purchase insurance against
liabilities asserted against and expenses incurred by persons
for our activities, regardless of whether we would have the
power to indemnify the person against liabilities under our
partnership agreement.
Reimbursement
of Expenses
Our partnership agreement requires us to reimburse our general
partner for all direct and indirect expenses it incurs or
payments it makes on our behalf and all other expenses allocable
to us or otherwise incurred by our general partner in connection
with operating our business. These expenses include salary,
bonus, incentive compensation and other amounts paid to persons
who perform services for us or on our behalf and expenses
allocated to our general partner by its affiliates. The general
partner is entitled to determine in good faith the expenses that
are allocable to us.
Books and
Reports
Our general partner is required to keep appropriate books of our
business at our principal offices. The books are maintained for
both tax and financial reporting purposes on an accrual basis.
For tax and fiscal reporting purposes, our fiscal year is the
calendar year.
We will furnish or make available to record holders of common
units, within 120 days after the close of each fiscal year,
an annual report containing audited financial statements and a
report on those financial statements by our independent public
accountants. Except for our fourth quarter, we will also furnish
or make available summary financial information within
90 days after the close of each quarter.
We will furnish each record holder of a unit with information
reasonably required for tax reporting purposes within
90 days after the close of each calendar year. This
information will be furnished in summary form so that some
complex calculations normally required of partners can be
avoided. Our ability to furnish this summary information to
unitholders will depend on the cooperation of unitholders in
supplying us with specific information. Every unitholder will
receive information to assist him in determining his federal and
state tax liability and filing his federal and state income tax
returns, regardless of whether he supplies us with information.
Right to
Inspect Our Books and Records
Our partnership agreement provides that a limited partner can,
for a purpose reasonably related to his interest as a limited
partner, upon reasonable written demand stating the purpose of
such demand and at his own expense, have furnished to him:
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a current list of the name and last known address of each
partner;
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a copy of our tax returns;
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information as to the amount of cash, and a description and
statement of the agreed value of any other property or services,
contributed or to be contributed by each partner and the date on
which each partner became a partner;
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copies of our partnership agreement, our certificate of limited
partnership, related amendments and powers of attorney under
which they have been executed;
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information regarding the status of our business and financial
condition; and
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any other information regarding our affairs as is just and
reasonable.
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Our general partner may, and intends to, keep confidential from
the limited partners trade secrets or other information the
disclosure of which our general partner believes in good faith
is not in our best interests or that we are required by law or
by agreements with third parties to keep confidential.
Registration
Rights
Under our partnership agreement, we have agreed to register for
resale under the Securities Act and applicable state securities
laws any common units or other partnership securities proposed
to be sold by our general partner or any of its affiliates or
their assignees if an exemption from the registration
requirements is not otherwise available. These registration
rights continue for two years following any withdrawal or
removal of our general partner. We are obligated to pay all
expenses incidental to the registration, excluding underwriting
discounts and a structuring fee.
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CASH
DISTRIBUTION POLICY
Distributions
of Available Cash
General. Our partnership agreement requires
that, within 45 days after the end of each quarter, we
distribute all of our available cash from operating surplus for
any quarter to unitholders of record on the applicable record
date in the following manner:
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first, 98% to all unitholders, pro rata, and 2% to the general
partner, until we distribute for each outstanding unit an amount
equal to the minimum quarterly distribution for that
quarter; and
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thereafter, in the manner described in General
Partner Interest and Incentive Distribution Rights below.
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The preceding discussion is based on the assumptions that our
general partner maintains its 2% general partner interest and
that we do not issue additional classes of equity securities.
Definition of Available Cash. The term
available cash, for any quarter, means all cash and
cash equivalents on hand on the date of determination of
available cash for that quarter less the amount of cash reserves
established by our general partner to:
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provide for the proper conduct of our business;
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comply with applicable law, any of our debt instruments or other
agreements; or
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provide funds for distributions to our unitholders and to our
general partner for any one or more of the next four quarters.
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Minimum Quarterly Distribution. We will
distribute to the holders of common units on a quarterly basis
at least the minimum quarterly distribution to the extent we
have sufficient cash from our operations after establishment of
cash reserves and payment of fees and expenses, including
payments to our general partner. However, there is no guarantee
that we will pay the minimum quarterly distribution on the units
in any quarter. Even if our cash distribution policy is not
modified or revoked, the amount of distributions paid under our
policy and the decision to make any distribution is determined
by our general partner, taking into consideration the terms of
our partnership agreement. We will be prohibited from making any
distributions to unitholders if it would cause an event of
default, or an event of default is existing, under our credit
agreement.
General Partner Interest and Incentive Distribution
Rights. Our general partner is currently entitled
to 2% of all quarterly distributions that we make prior to our
liquidation. Our general partner has the right, but not the
obligation, to contribute a proportionate amount of capital to
us to maintain its current general partner interest. The general
partners 2% interest in these distributions may be reduced
if we issue additional units in the future and our general
partner does not contribute a proportionate amount of capital to
us to maintain its 2% general partner interest.
Our general partner also currently holds incentive distribution
rights that entitle it to receive increasing percentages, up to
a maximum of 50%, of the cash we distribute from operating
surplus (as defined below) in excess of $0.3881 per unit per
quarter. The maximum distribution of 50% includes distributions
paid to our general partner on its general partner interest and
assumes that our general partner maintains its general partner
interest at 2%. Please see General Partner
Interest and Incentive Distribution Rights for additional
information.
Operating
Surplus and Capital Surplus
General. All cash distributed to unitholders
will be characterized as either operating surplus or
capital surplus. Our partnership agreement requires
that we distribute available cash from operating surplus
differently than available cash from capital surplus.
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Operating Surplus. Operating surplus consists
of:
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an amount equal to four times the amount needed for any one
quarter for us to pay a distribution on all of our units
(including the general partner units) and the incentive
distribution rights at the same
per-unit
amount as was distributed in the immediately preceding quarter;
plus
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all of our cash receipts, excluding cash from borrowings, sales
of equity and debt securities, sales or other dispositions of
assets outside the ordinary course of business, capital
contributions or corporate reorganizations or restructurings
(provided that cash receipts from the termination of a commodity
hedge or interest rate swap prior to its specified termination
date shall be included in operating surplus in equal quarterly
installments over the scheduled life of such commodity hedge or
interest rate swap); less
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all of our operating expenditures, but excluding the repayment
of borrowings, and including maintenance capital expenditures;
less
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the amount of cash reserves established by our general partner
to provide funds for future operating expenditures.
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Maintenance capital expenditures represent capital expenditures
made to replace partially or fully depreciated assets, to
maintain the existing operating capacity of our assets and to
extend their useful lives, or other capital expenditures that
are incurred in maintaining existing system volumes and related
cash flows. Expansion capital expenditures represent capital
expenditures made to expand or to increase the efficiency of the
existing operating capacity of our assets or to expand the
operating capacity or revenues of existing or new assets,
whether through construction or acquisition. Costs for repairs
and minor renewals to maintain facilities in operating condition
and that do not extend the useful life of existing assets will
be treated as operating expenses as we incur them. Our
partnership agreement provides that our general partner
determines how to allocate a capital expenditure for the
acquisition or expansion of our assets between maintenance
capital expenditures and expansion capital expenditures.
Capital Surplus. Capital surplus generally
consists of:
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borrowings;
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sales of our equity and debt securities;
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sales or other dispositions of assets for cash, other than
inventory, accounts receivable and other current assets sold in
the ordinary course of business or as part of normal retirement
or replacement of assets;
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capital contributions received; and
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corporate restructurings.
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Characterization of Cash Distributions. Our
partnership agreement requires that we treat all available cash
distributed as coming from operating surplus until the sum of
all available cash distributed since we began operations equals
the operating surplus as of the most recent date of
determination of available cash. Our partnership agreement
requires that we treat any amount distributed in excess of
operating surplus, regardless of its source, as capital surplus.
As reflected above, operating surplus includes an amount equal
to four times the amount needed for any one quarter for us to
pay a distribution on all of our units (including the general
partner units) and the incentive distribution rights at the same
per-unit
amount as was distributed in the immediately preceding quarter.
This amount does not reflect actual cash on hand that is
available for distribution to our unitholders. Rather, it is a
provision that will enable us, if we choose, to distribute as
operating surplus up to this amount of cash we receive in the
future from non-operating sources, such as asset sales,
issuances of securities, and borrowings, that would otherwise be
distributed as capital surplus. We do not anticipate that we
will make any distributions from capital surplus.
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General
Partner Interest and Incentive Distribution Rights
Our partnership agreement provides that our general partner is
entitled to 2% of all distributions that we make prior to our
liquidation as long as our general partner maintains its current
2% interest in us. Our general partner has the right, but not
the obligation, to contribute a proportionate amount of capital
to us to maintain its 2% general partner interest if we issue
additional units. Our general partners 2% interest, and
the percentage of our cash distributions to which it is
entitled, will be proportionately reduced if we issue additional
units in the future and our general partner does not contribute
a proportionate amount of capital to us in order to maintain its
2% general partner interest. Our general partner will be
entitled to make a capital contribution in order to maintain its
2% general partner interest in the form of the contribution to
us of common units that it may hold based on the current market
value of the contributed common units.
Incentive distribution rights represent the right to receive an
increasing percentage (13%, 23% and 48%) of quarterly
distributions of available cash from operating surplus after the
minimum quarterly distribution and the target distribution
levels have been achieved. Our general partner currently holds
the incentive distribution rights, but may transfer these rights
separately from its general partner interest, subject to
restrictions in the partnership agreement.
The following discussion assumes that the general partner
maintains its 2% general partner interest and continues to own
the incentive distribution rights.
If for any quarter we have distributed available cash from
operating surplus to the common unitholders in an amount equal
to the minimum quarterly distribution, then, our partnership
agreement requires that we distribute any additional available
cash from operating surplus for that quarter among the
unitholders and the general partner in the following manner:
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first, 98% to all unitholders, pro rata, and 2% to the
general partner, until each unitholder receives a total of
$0.3881 per unit for that quarter (the first target
distribution);
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second, 85% to all unitholders, pro rata, and 15% to the
general partner, until each unitholder receives a total of
$0.4219 per unit for that quarter (the second target
distribution);
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third, 75% to all unitholders, pro rata, and 25% to the
general partner, until each unitholder receives a total of
$0.50625 per unit for that quarter (the third target
distribution); and
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thereafter, 50% to all unitholders, pro rata, and 50% to
the general partner.
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Percentage
Allocations of Available Cash from Operating Surplus
The following table illustrates the percentage allocations of
available cash from operating surplus between the unitholders
and our general partner based on the specified target
distribution levels. The amounts set forth under Marginal
Percentage Interest in Distributions are the percentage
interests of our general partner and the unitholders in any
available cash from operating surplus we distribute up to and
including the corresponding amount in the column Total
Quarterly Distribution Per Unit, until available cash from
operating surplus we distribute reaches the next target
distribution level, if any. The percentage interests shown for
the unitholders and the general partner for the minimum
quarterly distribution are also applicable to quarterly
distribution amounts that are less than the minimum quarterly
distribution. The percentage interests set forth below for our
general partner include its 2% general partner interest and
assume our general partner has
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contributed any additional capital to maintain its 2% general
partner interest and has not transferred its incentive
distribution rights.
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Total Quarterly
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Marginal Percentage Interest in Distributions
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Distribution per Unit
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General
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Target Amount
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Unitholders
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Partner
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Minimum Quarterly Distribution
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$0.3375
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98
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%
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2
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%
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First Target Distribution
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up to $0.3881
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98
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%
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2
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%
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Second Target Distribution
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above $0.3881 up to $0.4219
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85
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%
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15
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%
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Third Target Distribution
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above $0.4219 up to $0.50625
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75
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%
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25
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%
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Thereafter
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above $0.50625
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50
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%
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50
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%
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General
Partners Right to Reset Incentive Distribution
Levels
Our general partner, as the holder of our incentive distribution
rights, has the right under our partnership agreement to elect
to relinquish the right to receive incentive distribution
payments based on the initial cash target distribution levels
and to reset, at higher levels, the minimum quarterly
distribution amount and cash target distribution levels upon
which the incentive distribution payments to our general partner
would be set. Our general partners right to reset the
minimum quarterly distribution amount and the target
distribution levels upon which the incentive distributions
payable to our general partner are based may be exercised,
without approval of our unitholders or the conflicts committee
of our general partner, at any time when we have made cash
distributions to the holders of the incentive distribution
rights at the highest level of incentive distribution for each
of the prior four consecutive fiscal quarters. The reset minimum
quarterly distribution amount and target distribution levels
will be higher than the minimum quarterly distribution amount
and the target distribution levels prior to the reset such that
our general partner will not receive any incentive distributions
under the reset target distribution levels until cash
distributions per unit following this event increase as
described below. We anticipate that our general partner would
exercise this reset right in order to facilitate acquisitions or
internal growth projects that would otherwise not be
sufficiently accretive to cash distributions per common unit,
taking into account the existing levels of incentive
distribution payments being made to our general partner.
In connection with the resetting of the minimum quarterly
distribution amount and the target distribution levels and the
corresponding relinquishment by our general partner of incentive
distribution payments based on the target cash distributions
prior to the reset, our general partner will be entitled to
receive a number of newly issued Class B units based on a
predetermined formula described below that takes into account
the cash parity value of the average cash
distributions related to the incentive distribution rights
received by our general partner for the two quarters prior to
the reset event as compared to the average cash distributions
per common unit during this period.
The number of Class B units that our general partner would
be entitled to receive from us in connection with a resetting of
the minimum quarterly distribution amount and the target
distribution levels then in effect would be equal to
(x) the average amount of cash distributions received by
our general partner in respect of its incentive distribution
rights during the two consecutive fiscal quarters ended
immediately prior to the date of such reset election divided by
(y) the average of the amount of cash distributed per
common unit during each of these two quarters. Each Class B
unit will be convertible into one common unit at the election of
the holder of the Class B unit at any time following the
first anniversary of the issuance of these Class B units.
We will also issue an additional amount of general partner units
in order to maintain the general partners ownership
interest in us relative to the issuance of the Class B
units.
Following a reset election by our general partner, the minimum
quarterly distribution amount will be reset to an amount equal
to the average cash distribution amount per common unit for the
two fiscal quarters immediately preceding the reset election
(such amount is referred to as the reset minimum quarterly
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distribution) and the target distribution levels will be
reset to be correspondingly higher such that we would distribute
all of our available cash from operating surplus for each
quarter thereafter as follows:
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first, 98% to all unitholders, pro rata, and 2% to the
general partner, until each unitholder receives an amount equal
to 115% of the reset minimum quarterly distribution for that
quarter;
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second, 85% to all unitholders, pro rata, and 15% to the
general partner, until each unitholder receives an amount per
unit equal to 125% of the reset minimum quarterly distribution
for that quarter;
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third, 75% to all unitholders, pro rata, and 25% to the
general partner, until each unitholder receives an amount per
unit equal to 150% of the reset minimum quarterly distribution
for that quarter; and
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thereafter, 50% to all unitholders, pro rata, and 50% to
the general partner.
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Distributions
from Capital Surplus
How Distributions from Capital Surplus Will Be
Made. Our partnership agreement requires that we
make distributions of available cash from capital surplus, if
any, in the following manner:
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first, 98% to all unitholders, pro rata, and 2% to the
general partner, until we distribute for each common unit an
amount of available cash from capital surplus equal to the
initial public offering price; and
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thereafter, we will make all distributions of available
cash from capital surplus as if they were from operating surplus.
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Effect of a Distribution from Capital
Surplus. Our partnership agreement treats a
distribution of capital surplus as the repayment of the initial
unit price from the initial public offering, which is a return
of capital. The initial public offering price less any
distributions of capital surplus per unit is referred to as the
unrecovered initial unit price. Each time a
distribution of capital surplus is made, the minimum quarterly
distribution and the target distribution levels will be reduced
in the same proportion as the corresponding reduction in the
unrecovered initial unit price. Because distributions of capital
surplus will reduce the minimum quarterly distribution, after
any of these distributions are made, it may be easier for the
general partner to receive incentive distributions. However, any
distribution of capital surplus before the unrecovered initial
unit price is reduced to zero cannot be applied to the payment
of the minimum quarterly distribution or any arrearages.
Once we distribute capital surplus on a unit in an amount equal
to the initial unit price, our partnership agreement specifies
that the minimum quarterly distribution and the target
distribution levels will be reduced to zero. Our partnership
agreement specifies that we then make all future distributions
from operating surplus, with 50% being paid to the holders of
units and 50% to the general partner. The percentage interests
shown for our general partner include its 2% general partner
interest and assume the general partner has not transferred the
incentive distribution rights.
Adjustment
to the Minimum Quarterly Distribution and Target Distribution
Levels
In addition to adjusting the minimum quarterly distribution and
target distribution levels to reflect a distribution of capital
surplus, if we combine our units into fewer units or subdivide
our units into a greater number of units, our partnership
agreement specifies that the following items will be
proportionately adjusted:
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the minimum quarterly distribution;
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target distribution levels; and
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the unrecovered initial unit price.
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For example, if a
two-for-one
split of our common units should occur, the minimum quarterly
distribution, the target distribution levels and the unrecovered
initial unit price would each be reduced to 50% of its initial
level. Our partnership agreement provides that we not make any
adjustment by reason of the issuance of additional units for
cash or property.
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In addition, if legislation is enacted or if existing law is
modified or interpreted by a governmental taxing authority, so
that we become taxable as a corporation or otherwise subject to
taxation as an entity for federal, state or local income tax
purposes, our partnership agreement specifies that the general
partner may reduce the minimum quarterly distribution and the
target distribution levels for each quarter by multiplying each
distribution level by a fraction, the numerator of which is
available cash for that quarter and the denominator of which is
the sum of available cash for that quarter plus the general
partners estimate of our aggregate liability for the
quarter for such income taxes payable by reason of such
legislation or interpretation. To the extent that the actual tax
liability differs from the estimated tax liability for any
quarter, the difference will be accounted for in subsequent
quarters.
Distributions
of Cash Upon Liquidation
General. If we dissolve in accordance with the
partnership agreement, we will sell or otherwise dispose of our
assets in a process called liquidation. We will first apply the
proceeds of liquidation to the payment of our creditors. We will
distribute any remaining proceeds to the unitholders and the
general partner, in accordance with their capital account
balances, as adjusted to reflect any gain or loss upon the sale
or other disposition of our assets in liquidation.
The allocations of gain and loss upon liquidation are intended,
to the extent required, to permit common unitholders to receive
their unrecovered initial unit price plus the minimum quarterly
distribution for the quarter during which liquidation occurs.
However, there may not be sufficient gain upon our liquidation
to enable the holders of common units to fully recover all of
these amounts. Any further net gain recognized upon liquidation
will be allocated in a manner that takes into account the
incentive distribution rights of the general partner.
Manner of Adjustments for Gain. The manner of
the adjustment for gain is set forth in the partnership
agreement. We will allocate any gain to the partners in the
following manner:
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first, to the general partner and the holders of units
who have negative balances in their capital accounts to the
extent of and in proportion to those negative balances;
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second, 98% to the common unitholders, pro rata, and 2%
to the general partner, until the capital account for each
common unit is equal to the sum of: (1) the unrecovered
initial unit price; and (2) the amount of the minimum
quarterly distribution for the quarter during which our
liquidation occurs;
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third, 98% to all unitholders, pro rata, and 2% to the
general partner, until we allocate under this paragraph an
amount per unit equal to: (1) the sum of the excess of the
first target distribution per unit over the minimum quarterly
distribution per unit for each quarter of our existence; less
(2) the cumulative amount per unit of any distributions of
available cash from operating surplus in excess of the minimum
quarterly distribution per unit that we distributed 98% to the
unitholders, pro rata, and 2% to the general partner, for each
quarter of our existence;
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fourth, 85% to all unitholders, pro rata, and 15% to the
general partner, until we allocate under this paragraph an
amount per unit equal to: (1) the sum of the excess of the
second target distribution per unit over the first target
distribution per unit for each quarter of our existence; less
(2) the cumulative amount per unit of any distributions of
available cash from operating surplus in excess of the first
target distribution per unit that we distributed 85% to the
unitholders, pro rata, and 15% to the general partner for each
quarter of our existence;
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fifth, 75% to all unitholders, pro rata, and 25% to the
general partner, until we allocate under this paragraph an
amount per unit equal to: (1) the sum of the excess of the
third target distribution per unit over the second target
distribution per unit for each quarter of our existence; less
(2) the cumulative amount per unit of any distributions of
available cash from operating surplus in excess of the second
target distribution per unit that we distributed 75% to the
unitholders, pro rata, and 25% to the general partner for each
quarter of our existence; and
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thereafter, 50% to all unitholders, pro rata, and 50% to
the general partner.
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The percentage interests set forth above for our general partner
include its 2% general partner interest and assume the general
partner has not transferred the incentive distribution rights.
Manner of Adjustments for Losses. After making
allocations of loss to the general partner and the unitholders
in a manner intended to offset in reverse order the allocations
of gains that have previously been allocated, we will generally
allocate any loss to the general partner and the unitholders in
the following manner:
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first, 98% to the holders of common units in proportion
to the positive balances in their capital accounts and 2% to the
general partner, until the capital accounts of the common
unitholders have been reduced to zero; and
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thereafter, 100% to the general partner.
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Adjustments to Capital Accounts. Our
partnership agreement requires that we make adjustments to
capital accounts upon the issuance of additional units. In this
regard, our partnership agreement specifies that we allocate any
unrealized and, for tax purposes, unrecognized gain or loss
resulting from the adjustments to the unitholders and the
general partner in the same manner as we allocate gain or loss
upon liquidation. In the event that we make positive adjustments
to the capital accounts upon the issuance of additional units,
our partnership agreement requires that we allocate any later
negative adjustments to the capital accounts resulting from the
issuance of additional units or upon our liquidation in a manner
which results, to the extent possible, in the general
partners capital account balances equaling the amount
which they would have been if no earlier positive adjustments to
the capital accounts had been made.
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DESCRIPTION
OF THE DEBT SECURITIES
General
The debt securities will be:
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our direct general obligations;
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either senior debt securities or subordinated debt
securities; and
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issued under separate indentures among us and a trustee.
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Targa Resources Partners LP may issue debt securities in one or
more series, and Targa Resources Partners Finance Corporation
may be a co-issuer of one or more series of debt securities.
Targa Resources Partners Finance Corporation was incorporated
under the laws of the State of Delaware on May 23, 2008, is
wholly-owned by Targa Resources Partners LP, and has no material
assets or liabilities other than as a co-issuer of debt
securities. Its activities will be limited to co-issuing debt
securities and engaging in other activities incidental thereto.
When used in this section, Description of the Debt
Securities, the terms we, us,
our and issuers refer jointly to Targa
Resources Partners LP and Targa Resources Partners Finance
Corporation, and the terms Targa Resources Partners
LP and Targa Resources Partners Finance refer
strictly to Targa Resources Partners LP and Targa Resources
Partners Finance Corporation, respectively.
If we offer senior debt securities, we will issue them under a
senior indenture. If we issue subordinated debt securities, we
will issue them under a subordinated indenture. The trustee
under each indenture (the Trustee) will be named in
the applicable prospectus supplement. A form of each indenture
is filed as an exhibit to the registration statement of which
this prospectus is a part. We have not restated either indenture
in its entirety in this description. You should read the
relevant indenture because it, and not this description,
controls your rights as holders of the debt securities.
Capitalized terms used in the summary have the meanings
specified in the indentures.
Specific
Terms of Each Series of Debt Securities in the Prospectus
Supplement
A prospectus supplement and a supplemental indenture or
authorizing resolutions relating to any series of debt
securities being offered will include specific terms relating to
the offering. These terms will include some or all of the
following:
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whether Targa Resources Partners Finance will be a co-issuer of
the debt securities;
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whether the debt securities are senior or subordinated debt
securities;
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the title of the debt securities;
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the total principal amount of the debt securities;
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the assets, if any, that are pledged as security for the payment
of the debt securities;
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whether we will issue the debt securities in individual
certificates to each holder in registered form, or in the form
of temporary or permanent global securities held by a depository
on behalf of holders;
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the prices at which we will issue the debt securities;
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the portion of the principal amount that will be payable if the
maturity of the debt securities is accelerated;
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the currency or currency unit in which the debt securities will
be payable, if not U.S. dollars;
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the dates on which the principal of the debt securities will be
payable;
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the interest rate that the debt securities will bear and the
interest payment dates for the debt securities;
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any conversion or exchange provisions;
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any optional redemption provisions;
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any sinking fund or other provisions that would obligate us to
repurchase or otherwise redeem the debt securities;
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any changes to or additional events of default or
covenants; and
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any other terms of the debt securities.
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We may offer and sell debt securities, including original issue
discount debt securities, at a substantial discount below their
principal amount. The prospectus supplement will describe
special U.S. federal income tax and any other
considerations applicable to those securities. In addition, the
prospectus supplement may describe certain special
U.S. federal income tax or other considerations applicable
to any debt securities that are denominated in a currency other
than U.S. dollars.
Guarantees
None of our subsidiaries will guarantee our obligations under
the debt securities.
Consolidation,
Merger or Asset Sale
Each indenture will, in general, allow us to consolidate or
merge with or into another domestic entity. It will also allow
each issuer to sell, lease, transfer or otherwise dispose of all
or substantially all of its assets to another domestic entity.
If this happens, the remaining or acquiring entity must assume
all of the issuers responsibilities and liabilities under
the indenture including the payment of all amounts due on the
debt securities and performance of the issuers covenants
in the indenture.
However, each indenture will impose certain requirements with
respect to any consolidation or merger with or into an entity,
or any sale, lease, transfer or other disposition of all or
substantially all of an issuers assets, including:
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the remaining or acquiring entity must be organized under the
laws of the United States, any state or the District of
Columbia; provided that Targa Resources Partners Finance may not
merge, amalgamate or consolidate with or into another entity
other than a corporation satisfying such requirement for so long
as Targa Resources Partners LP is not a corporation;
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the remaining or acquiring entity must assume the issuers
obligations under the indenture; and
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immediately after giving effect to the transaction, no Default
or Event of Default (as defined under Events
of Default and Remedies below) may exist.
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The remaining or acquiring entity will be substituted for the
issuer in the indenture with the same effect as if it had been
an original party to the indenture, and, except in the case of a
lease of all or substantially all of its assets, the issuer will
be relieved from any further obligations under the indenture.
No
Protection in the Event of a Change of Control
Unless otherwise set forth in the prospectus supplement, the
debt securities will not contain any provisions that protect the
holders of the debt securities in the event of a change of
control of us or in the event of a highly leveraged transaction,
whether or not such transaction results in a change of control
of us.
Modification
of Indentures
We may supplement or amend an indenture if the holders of a
majority in aggregate principal amount of the outstanding debt
securities of all series issued under the indenture affected by
the supplement or amendment consent to it. Further, the holders
of a majority in aggregate principal amount of the outstanding
debt securities of any series may waive past defaults under the
indenture and compliance by us with our covenants with respect
to the debt securities of that series only. Those holders may
not, however, waive any default in any payment on any debt
security of that series or compliance with a provision that
cannot be
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supplemented or amended without the consent of each holder
affected. Without the consent of each outstanding debt security
affected, no modification of the indenture or waiver may:
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reduce the principal amount of debt securities whose holders
must consent to an amendment, supplement or waiver;
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reduce the principal of or change the fixed maturity of any debt
security;
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reduce or waive the premium payable upon redemption or alter or
waive the provisions with respect to the redemption of the debt
securities (except as may be permitted in the case of a
particular series of debt securities);
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reduce the rate of or change the time for payment of interest on
any debt security;
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waive a Default or an Event of Default in the payment of
principal of or premium, if any, or interest on the debt
securities (except a rescission of acceleration of the debt
securities by the holders of at least a majority in aggregate
principal amount of the debt securities and a waiver of the
payment default that resulted from such acceleration);
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except as otherwise permitted under the indenture, release any
security that may have been granted with respect to the debt
securities;
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make any debt security payable in currency other than that
stated in the debt securities;
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in the case of any subordinated debt security, make any change
in the subordination provisions that adversely affects the
rights of any holder under those provisions;
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make any change in the provisions of the indenture relating to
waivers of past Defaults or the rights of holders of debt
securities to receive payments of principal of or premium, if
any, or interest on the debt securities;
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waive a redemption payment with respect to any debt security
(except as may be permitted in the case of a particular series
of debt securities); or
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make any change in the preceding amendment, supplement and
waiver provisions (except to increase any percentage set forth
therein).
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We may supplement or amend an indenture without the consent of
any holders of the debt securities in certain circumstances,
including:
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to establish the form of terms of any series of debt securities;
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to cure any ambiguity, defect or inconsistency;
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to provide for uncertificated notes in addition to or in place
of certified notes;
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to provide for the assumption of an issuers obligations to
holders of debt securities in the case of a merger or
consolidation or disposition of all or substantially all of such
issuers assets;
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in the case of any subordinated debt security, to make any
change in the subordination provisions that limits or terminates
the benefits applicable to any holder of Senior Indebtedness of
Targa Resources Partners LP;
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to make any changes that would provide any additional rights or
benefits to the holders of debt securities or that do not, taken
as a whole, adversely affect the rights under the indenture of
any holder of debt securities;
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to comply with requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the
Trust Indenture Act;
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to evidence or provide for the acceptance of appointment under
the indenture of a successor Trustee;
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to add any additional Events of Default; or
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to secure the debt securities.
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Events of
Default and Remedies
Event of Default, when used in an indenture,
will mean any of the following with respect to the debt
securities of any series:
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failure to pay when due the principal of or any premium on any
debt security of that series;
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failure to pay, within 30 days of the due date, interest on
any debt security of that series;
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failure to pay when due any sinking fund payment with respect to
any debt securities of that series;
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failure on the part of the issuers to comply with the covenant
described under Consolidation, Merger or Asset
Sale;
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failure to perform any other covenant in the indenture that
continues for 60 days after written notice is given to the
issuers;
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certain events of bankruptcy, insolvency or reorganization of an
issuer; or
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any other Event of Default provided under the terms of the debt
securities of that series.
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An Event of Default for a particular series of debt securities
will not necessarily constitute an Event of Default for any
other series of debt securities issued under an indenture. The
Trustee may withhold notice to the holders of debt securities of
any default (except in the payment of principal, premium, if
any, or interest) if it considers such withholding of notice to
be in the best interests of the holders.
If an Event of Default described in the sixth bullet point above
occurs, the entire principal of, premium, if any, and accrued
interest on, all debt securities then outstanding will be due
and payable immediately, without any declaration or other act on
the part of the Trustee or any holders. If any other Event of
Default for any series of debt securities occurs and continues,
the Trustee or the holders of at least 25% in aggregate
principal amount of the debt securities of the series may
declare the entire principal of, and accrued interest on, all
the debt securities of that series to be due and payable
immediately. If this happens, subject to certain conditions, the
holders of a majority in the aggregate principal amount of the
debt securities of that series can rescind the declaration.
Other than its duties in case of a default, a Trustee is not
obligated to exercise any of its rights or powers under either
indenture at the request, order or direction of any holders,
unless the holders offer the Trustee reasonable security or
indemnity. If they provide this reasonable security or
indemnification, the holders of a majority in aggregate
principal amount of any series of debt securities may direct the
time, method and place of conducting any proceeding or any
remedy available to the Trustee, or exercising any power
conferred upon the Trustee, for that series of debt securities.
No Limit
on Amount of Debt Securities
Neither indenture will limit the amount of debt securities that
we may issue, unless we indicate otherwise in a prospectus
supplement. Each indenture will allow us to issue debt
securities of any series up to the aggregate principal amount
that we authorize.
Registration
of Notes
We will issue debt securities of a series only in registered
form, without coupons, unless otherwise indicated in the
prospectus supplement.
Minimum
Denominations
Unless the prospectus supplement states otherwise, the debt
securities will be issued only in principal amounts of $1,000
each or integral multiples of $1,000.
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No
Personal Liability
None of the past, present or future partners, incorporators,
managers, members, directors, officers, employees, unitholders
or stockholders of either issuer or the general partner of Targa
Resources Partners LP will have any liability for the
obligations of the issuers under either indenture or the debt
securities or for any claim based on such obligations or their
creation. Each holder of debt securities by accepting a debt
security waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of the
debt securities. The waiver may not be effective under federal
securities laws, however, and it is the view of the SEC that
such a waiver is against public policy.
Payment
and Transfer
The Trustee will initially act as paying agent and registrar
under each indenture. The issuers may change the paying agent or
registrar without prior notice to the holders of debt
securities, and the issuers or any of their subsidiaries may act
as paying agent or registrar.
If a holder of debt securities has given wire transfer
instructions to the issuers, the issuers will make all payments
on the debt securities in accordance with those instructions.
All other payments on the debt securities will be made at the
corporate trust office of the Trustee, unless the issuers elect
to make interest payments by check mailed to the holders at
their addresses set forth in the debt security register.
The Trustee and any paying agent will repay to us upon request
any funds held by them for payments on the debt securities that
remain unclaimed for two years after the date upon which that
payment has become due. After payment to us, holders entitled to
the money must look to us for payment as general creditors.
Exchange,
Registration and Transfer
Debt securities of any series will be exchangeable for other
debt securities of the same series, the same total principal
amount and the same terms but in different authorized
denominations in accordance with the indenture. Holders may
present debt securities for exchange or registration of transfer
at the office of the registrar. The registrar will effect the
transfer or exchange when it is satisfied with the documents of
title and identity of the person making the request. We will not
charge a service charge for any registration of transfer or
exchange of the debt securities. We may, however, require the
payment of any tax or other governmental charge payable for that
registration.
We will not be required:
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to issue, register the transfer of, or exchange debt securities
of a series either during a period beginning 15 business days
prior to the selection of debt securities of that series for
redemption and ending on the close of business on the day of
mailing of the relevant notice of redemption or repurchase, or
between a record date and the next succeeding interest payment
date; or
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to register the transfer of or exchange any debt security called
for redemption or repurchase, except the unredeemed portion of
any debt security we are redeeming or repurchasing in part.
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Provisions
Relating only to the Senior Debt Securities
The senior debt securities will rank equally in right of payment
with all of our other unsubordinated debt. The senior debt
securities will be effectively subordinated, however, to all of
our secured debt to the extent of the value of the collateral
for that debt. We will disclose the amount of our secured debt
in the prospectus supplement.
Provisions
Relating only to the Subordinated Debt Securities
Subordinated
Debt Securities Subordinated to Senior
Indebtedness
The subordinated debt securities will rank junior in right of
payment to all of the Senior Indebtedness of Targa Resources
Partners LP. Senior Indebtedness will be defined in
a supplemental indenture or authorizing
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resolutions respecting any issuance of a series of subordinated
debt securities, and the definition will be set forth in the
prospectus supplement.
Payment
Blockages
The subordinated indenture will provide that no payment of
principal, interest and any premium on the subordinated debt
securities may be made in the event:
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we or our property is involved in any voluntary or involuntary
liquidation or bankruptcy;
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we fail to pay the principal, interest, any premium or any other
amounts on any Senior Indebtedness of Targa Resources Partners
LP within any applicable grace period or the maturity of such
Senior Indebtedness is accelerated following any other default,
subject to certain limited exceptions set forth in the
subordinated indenture; or
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any other default on any Senior Indebtedness of Targa Resources
Partners LP occurs that permits immediate acceleration of its
maturity, in which case a payment blockage on the subordinated
debt securities will be imposed for a maximum of 179 days
at any one time.
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No
Limitation on Amount of Senior Debt
The subordinated indenture will not limit the amount of Senior
Indebtedness that Targa Resources Partners LP may incur, unless
otherwise indicated in the prospectus supplement.
Book
Entry, Delivery and Form
The debt securities of a particular series may be issued in
whole or in part in the form of one or more global certificates
that will be deposited with the Trustee as custodian for The
Depository Trust Company, New York, New York
(DTC) This means that we will not issue certificates
to each holder. Instead, one or more global debt securities will
be issued to DTC, who will keep a computerized record of its
participants (for example, your broker) whose clients have
purchased the debt securities. The participant will then keep a
record of its clients who purchased the debt securities. Unless
it is exchanged in whole or in part for a certificated debt
security, a global debt security may not be transferred, except
that DTC, its nominees and their successors may transfer a
global debt security as a whole to one another.
Beneficial interests in global debt securities will be shown on,
and transfers of global debt securities will be made only
through, records maintained by DTC and its participants.
DTC has provided us the following information: DTC is a
limited-purpose trust company organized under the New York
Banking Law, a banking organization within the
meaning of the New York Banking Law, a member of the United
States Federal Reserve System, a clearing
corporation within the meaning of the New York Uniform
Commercial Code and a clearing agency registered
under the provisions of Section 17A of the Securities
Exchange Act of 1934, as amended (the Exchange Act).
DTC holds securities that its participants (Direct
Participants) deposit with DTC. DTC also records the
settlement among Direct Participants of securities transactions,
such as transfers and pledges, in deposited securities through
computerized records for Direct Participants accounts.
This eliminates the need to exchange certificates. Direct
Participants include securities brokers and dealers, banks,
trust companies, clearing corporations and certain other
organizations.
DTCs book-entry system is also used by other organizations
such as securities brokers and dealers, banks, trust companies
and clearing corporations that work through a Direct
Participant. The rules that apply to DTC and its participants
are on file with the SEC.
DTC is a wholly-owned subsidiary of The Depository
Trust & Clearing Corporation (DTCC). DTCC
is the holding company for DTC, National Securities Clearing
Corporation and Fixed Income Clearing Corporation, all of which
are registered clearing agencies. DTCC is owned by the users of
its regulated subsidiaries.
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We will wire all payments on the global debt securities to
DTCs nominee. We and the Trustee will treat DTCs
nominee as the owner of the global debt securities for all
purposes. Accordingly, we, the Trustee and any paying agent will
have no direct responsibility or liability to pay amounts due on
the global debt securities to owners of beneficial interests in
the global debt securities.
It is DTCs current practice, upon receipt of any payment
on the global debt securities, to credit Direct
Participants accounts on the payment date according to
their respective holdings of beneficial interests in the global
debt securities as shown on DTCs records. In addition, it
is DTCs current practice to assign any consenting or
voting rights to Direct Participants whose accounts are credited
with debt securities on a record date, by using an omnibus
proxy. Payments by participants to owners of beneficial
interests in the global debt securities, and voting by
participants, will be governed by the customary practices
between the participants and owners of beneficial interests, as
is the case with debt securities held for the account of
customers registered in street name. However,
payments will be the responsibility of the participants and not
of DTC, the Trustee or us.
Debt securities represented by a global debt security will be
exchangeable for certificated debt securities with the same
terms in authorized denominations only if:
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DTC notifies us that it is unwilling or unable to continue as
depositary or if DTC ceases to be a clearing agency registered
under applicable law and in either event a successor depositary
is not appointed by us within 90 days; or
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an Event of Default occurs and DTC notifies the Trustee of its
decision to exchange the global debt security for certificated
debt securities.
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Satisfaction
and Discharge; Defeasance
Each indenture will be discharged and will cease to be of
further effect as to all outstanding debt securities of any
series issued thereunder, when:
(a) either:
(1) all outstanding debt securities of that series that
have been authenticated (except lost, stolen or destroyed debt
securities that have been replaced or paid and debt securities
for whose payment money has theretofore been deposited in trust
and thereafter repaid to us) have been delivered to the Trustee
for cancellation; or
(2) all outstanding debt securities of that series that
have not been delivered to the Trustee for cancellation have
become due and payable by reason of the giving of a notice of
redemption or otherwise or will become due and payable at their
stated maturity within one year or are to be called for
redemption within one year under arrangements satisfactory to
the Trustee and in any case we have irrevocably deposited or
caused to be irrevocably deposited with the Trustee as trust
funds in trust cash in U.S. dollars, non-callable
U.S. Government Obligations or a combination thereof, in
such amounts as will be sufficient, without consideration of any
reinvestment of interest, to pay and discharge the entire
indebtedness of such debt securities not delivered to the
Trustee for cancellation, for principal, premium, if any, and
accrued interest to the date of such deposit (in the case of
debt securities that have been due and payable) or the stated
maturity or redemption date;
(b) we have paid or caused to be paid all other sums
payable by us under the indenture; and
(c) we have delivered an officers certificate and an
opinion of counsel to the Trustee stating that all conditions
precedent to satisfaction and discharge have been satisfied.
The debt securities of a particular series will be subject to
legal or covenant defeasance to the extent, and upon the terms
and conditions, set forth in the prospectus supplement.
Governing
Law
Each indenture and all of the debt securities will be governed
by the laws of the State of New York.
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The
Trustee
We will enter into the indentures with a Trustee that is
qualified to act under the Trust Indenture Act of 1939, as
amended, and with any other trustees chosen by us and appointed
in a supplemental indenture for a particular series of debt
securities. We may maintain a banking relationship in the
ordinary course of business with our trustee and one or more of
its affiliates.
Resignation
or Removal of Trustee
If the Trustee has or acquires a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee must either
eliminate its conflicting interest or resign, to the extent and
in the manner provided by, and subject to the provisions of, the
Trust Indenture Act and the applicable indenture. Any
resignation will require the appointment of a successor trustee
under the applicable indenture in accordance with the terms and
conditions of such indenture.
The Trustee may resign or be removed by us with respect to one
or more series of debt securities and a successor Trustee may be
appointed to act with respect to any such series. The holders of
a majority in aggregate principal amount of the debt securities
of any series may remove the Trustee with respect to the debt
securities of such series.
Limitations
on Trustee if it is Our Creditor
Each indenture will contain certain limitations on the right of
the Trustee, in the event that it becomes a creditor of an
issuer, to obtain payment of claims in certain cases, or to
realize on certain property received in respect of any such
claim as security or otherwise.
Annual
Trustee Report to Holders of Debt Securities
The Trustee is required to submit an annual report to the
holders of the debt securities regarding, among other things,
the Trustees eligibility to serve as such, the priority of
the Trustees claims regarding certain advances made by it,
and any action taken by the Trustee materially affecting the
debt securities.
Certificates
and Opinions to be Furnished to Trustee
Each indenture will provide that, in addition to other
certificates or opinions that may be specifically required by
other provisions of the indenture, every application by us for
action by the Trustee shall be accompanied by a certificate of
certain of our officers and an opinion of counsel (who may be
our counsel) stating that, in the opinion of the signers, all
conditions precedent to such action have been complied with by
us.
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MATERIAL
INCOME TAX CONSEQUENCES
This section is a discussion of the material tax consequences
that may be relevant to prospective unitholders who are
individual citizens or residents of the United States and,
unless otherwise noted in the following discussion, is the
opinion of Vinson & Elkins L.L.P., counsel to our
general partner and us, insofar as it relates to legal
conclusions with respect to matters of United States federal
income tax law. This section is based upon current provisions of
the Internal Revenue Code of 1986, as amended (the
Internal Revenue Code), existing and proposed
Treasury regulations promulgated under the Internal Revenue Code
(the Treasury Regulations) and, current
administrative rulings and court decisions, all of which are
subject to change. Later changes in these authorities may cause
the tax consequences to vary substantially from the consequences
described below. Unless the context otherwise requires,
references in this section to us or we
are references to Targa Resources Partners LP and the Operating
Partnership.
The following discussion does not comment on all federal income
tax matters affecting us or the unitholders. Moreover, the
discussion focuses on unitholders who are individual citizens or
residents of the United States and has only limited application
to corporations, estates, trusts, nonresident aliens or other
unitholders subject to specialized tax treatment, such as
tax-exempt institutions, foreign persons, individual retirement
accounts (IRAs), real estate investment trusts (REITs) or mutual
funds. Accordingly, we urge each prospective unitholder to
consult, and depend on, his own tax advisor in analyzing the
federal, state, local and foreign tax consequences particular to
him of the ownership or disposition of common units.
All statements as to matters of law and legal conclusions, but
not as to factual matters, contained in this section, unless
otherwise noted, are the opinion of Vinson & Elkins
L.L.P. and are based on the accuracy of the representations made
by us.
No ruling has been or will be requested from the Internal
Revenue Service (the IRS) regarding our treatment as
a partnership for federal income tax purposes. Instead, we will
rely on opinions of Vinson & Elkins L.L.P. Unlike a
ruling, an opinion of counsel represents only that
counsels best legal judgment and does not bind the IRS or
the courts. Accordingly, the opinions and statements made herein
may not be sustained by a court if contested by the IRS. Any
contest of this sort with the IRS may materially and adversely
impact the market for our common units and the prices at which
common units trade. In addition, the costs of any contest with
the IRS, principally legal, accounting and related fees, will
result in a reduction in cash available for distribution to our
unitholders and our general partner and thus will be borne
indirectly by our unitholders and our general partner.
Furthermore, the tax treatment of us, or of an investment in us,
may be significantly modified by future legislative or
administrative changes or court decisions. Any modifications may
or may not be retroactively applied.
For the reasons described below, Vinson & Elkins
L.L.P. has not rendered an opinion with respect to the following
specific federal income tax issues: (1) the treatment of a
unitholder whose common units are loaned to a short seller to
cover a short sale of common units (please see
Tax Consequences of Unit
Ownership Treatment of Short Sales);
(2) whether our monthly convention for allocating taxable
income and losses is permitted by existing Treasury Regulations
(please see Disposition of Common
Units Allocations Between Transferors and
Transferees); and (3) whether our method for
depreciating Section 743 adjustments is sustainable in
certain cases (please see Tax Consequences of
Unit Ownership Section 754 Election).
Partnership
Status
A partnership is not a taxable entity and incurs no federal
income tax liability. Instead, each partner of a partnership is
required to take into account his share of items of income,
gain, loss and deduction of the partnership in computing his
federal income tax liability, regardless of whether cash
distributions are made to him by the partnership. Distributions
by a partnership to a partner are generally not taxable to the
partnership or to the partner unless the amount of cash
distributed to him is in excess of the partners adjusted
basis in his partnership interest.
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Section 7704 of the Internal Revenue Code provides that
publicly traded partnerships will, as a general rule, be taxed
as corporations. However, an exception, referred to as the
Qualifying Income Exception, exists with respect to
publicly traded partnerships of which 90% or more of the gross
income for every taxable year consists of qualifying
income. Qualifying income includes income and gains
derived from the transportation, storage, processing and
marketing of crude oil, natural gas and products thereof. Other
types of qualifying income include interest (other than from a
financial business), dividends, gains from the sale of real
property and gains from the sale or other disposition of capital
assets held for the production of income that otherwise
constitutes qualifying income. We estimate that less than 6% of
our current gross income is not qualifying income; however, this
estimate could change from time to time. Based upon and subject
to this estimate, the factual representations made by us and the
general partner and a review of the applicable legal
authorities, Vinson & Elkins L.L.P. is of the opinion
that at least 90% of our current gross income constitutes
qualifying income. The portion of our income that is qualifying
income may change from time to time.
No ruling has been or will be sought from the IRS and the IRS
has made no determination as to our status or the status of the
Operating Partnership as a partnership for federal income tax
purposes or whether our operations generate qualifying
income under Section 7704 of the Internal Revenue
Code. Instead, we will rely on the opinion of Vinson &
Elkins L.L.P. on such matters. It is the opinion of
Vinson & Elkins L.L.P. that, based upon the Internal
Revenue Code, its regulations, published revenue rulings and
court decisions and the representations described below, we will
be classified as a partnership and the Operating Partnership
will be disregarded as an entity separate from us for federal
income tax purposes.
In rendering its opinion, Vinson & Elkins L.L.P. has
relied on factual representations made by us and our general
partner. The representations made by us and our general partner
upon which Vinson & Elkins L.L.P. has relied include:
(a) Neither we nor the Operating Partnership has elected or
will elect to be treated as a corporation;
(b) For each taxable year, more than 90% of our gross
income has been and will be income that Vinson &
Elkins L.L.P. has opined or will opine is qualifying
income within the meaning of Section 7704(d) of the
Internal Revenue Code; and
(c) Each hedging transaction that we treat as resulting in
qualifying income has been and will be appropriately identified
as a hedging transaction pursuant to applicable Treasury
Regulations, and has been and will be associated with oil, gas,
or products thereof that are held or to be held by us in
activities that Vinson & Elkins L.L.P. has opined or
will opine result in qualifying income.
We believe that these representations have been true in the past
and expect that these representations will be true in the future.
If we fail to meet the Qualifying Income Exception, other than a
failure that is determined by the IRS to be inadvertent and that
is cured within a reasonable time after discovery (in which case
the IRS may also require us to make adjustments with respect to
our unitholders or pay other amounts), we will be treated as if
we had transferred all of our assets, subject to liabilities, to
a newly formed corporation, on the first day of the year in
which we fail to meet the Qualifying Income Exception, in return
for stock in that corporation, and then distributed that stock
to the unitholders in liquidation of their interests in us. This
deemed contribution and liquidation should be tax-free to
unitholders and us so long as we, at that time, do not have
liabilities in excess of the tax basis of our assets.
Thereafter, we would be treated as a corporation for federal
income tax purposes.
If we were treated as an association taxable as a corporation in
any taxable year, either as a result of a failure to meet the
Qualifying Income Exception or otherwise, our items of income,
gain, loss and deduction would be reflected only on our tax
return rather than being passed through to the unitholders, and
our net income would be taxed to us at corporate rates. In
addition, any distribution made to a unitholder would be treated
as either taxable dividend income, to the extent of our current
or accumulated earnings and profits, or, in the absence of
earnings and profits, a nontaxable return of capital, to the
extent of the unitholders tax basis in his common units,
or taxable capital gain, after the unitholders tax basis
in his common units is reduced to
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zero. Accordingly, taxation as a corporation would result in a
material reduction in a unitholders cash flow and
after-tax return and thus would likely result in a substantial
reduction of the value of the units.
The discussion below is based on Vinson & Elkins
L.L.P.s opinion that we will be classified as a
partnership for federal income tax purposes.
Limited
Partner Status
Unitholders who have become limited partners of Targa Resources
Partners LP will be treated as partners of Targa Resources
Partners LP for federal income tax purposes. Also, unitholders
whose common units are held in street name or by a nominee and
who have the right to direct the nominee in the exercise of all
substantive rights attendant to the ownership of their common
units will be treated as partners of Targa Resources Partners LP
for federal income tax purposes.
A beneficial owner of common units whose units have been
transferred to a short seller to complete a short sale would
appear to lose his status as a partner with respect to those
units for federal income tax purposes. Please see
Tax Consequences of Unit Ownership
Treatment of Short Sales.
Income, gain, deductions or losses would not appear to be
reportable by a unitholder who is not a partner for federal
income tax purposes, and any cash distributions received by a
unitholder who is not a partner for federal income tax purposes
would therefore appear to be fully taxable as ordinary income.
These holders are urged to consult their own tax advisors with
respect to their tax consequences of holding common units in
Targa Resources Partners LP.
The references to unitholders in the discussion that
follows are to persons who are treated as partners in Targa
Resources Partners LP for federal income tax purposes.
Tax
Consequences of Unit Ownership
Flow-Through of Taxable Income. We will not
pay any federal income tax. Instead, each unitholder will be
required to report on his income tax return his share of our
income, gains, losses and deductions without regard to whether
corresponding cash distributions are received by him.
Consequently, we may allocate income to a unitholder even if he
has not received a cash distribution. Each unitholder will be
required to include in income his allocable share of our income,
gains, losses and deductions for our taxable year ending with or
within his taxable year. Our taxable year ends on
December 31.
Treatment of Distributions. Distributions by
us to a unitholder generally will not be taxable to the
unitholder for federal income tax purposes, except to the extent
the amount of any such cash distribution exceeds his tax basis
in his common units immediately before the distribution. Our
cash distributions in excess of a unitholders tax basis
generally will be considered to be gain from the sale or
exchange of our common units, taxable in accordance with the
rules described under Disposition of
Common Units. Any reduction in a unitholders share
of our liabilities for which no partner, including the general
partner, bears the economic risk of loss, known as
nonrecourse liabilities, will be treated as a
distribution by us of cash to that unitholder. To the extent our
distributions cause a unitholders at risk
amount to be less than zero at the end of any taxable year, he
must recapture any losses deducted in previous years. Please see
Limitations on Deductibility of Losses.
A decrease in a unitholders percentage interest in us
because of our issuance of additional common units will decrease
his share of our nonrecourse liabilities, and thus will result
in a corresponding deemed distribution of cash. This deemed
distribution may constitute a non-pro rata distribution. A
non-pro rata distribution of money or property may result in
ordinary income to a unitholder, regardless of his tax basis in
his common units, if the distribution reduces the
unitholders share of our unrealized
receivables, including depreciation recapture,
and/or
substantially appreciated inventory items, both as
defined in the Internal Revenue Code, and collectively,
Section 751 Assets. To that extent, he will be
treated as having been distributed his proportionate share of
the Section 751 Assets and then having exchanged those
assets with us in return for the non-pro rata portion of the
actual distribution made to him. This latter deemed exchange
will generally result in the unitholders realization of
ordinary income, which will equal the excess of (1) the non-
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pro rata portion of that distribution over (2) the
unitholders tax basis (generally zero) for the share of
Section 751 Assets deemed relinquished in the exchange.
Basis of Common Units. A unitholders
initial tax basis for his common units will be the amount he
paid for our common units plus his share of our nonrecourse
liabilities. That basis will be increased by his share of our
income and by any increases in his share of our nonrecourse
liabilities. That basis will be decreased, but not below zero,
by distributions from us, by the unitholders share of our
losses, by any decreases in his share of our nonrecourse
liabilities and by his share of our expenditures that are not
deductible in computing taxable income and are not required to
be capitalized. A unitholder will have no share of our debt that
is recourse to our general partner, but will have a share,
generally based on his share of profits, of our nonrecourse
liabilities. Please see Disposition of Common
Units Recognition of Gain or Loss.
Limitations on Deductibility of Losses. The
deduction by a unitholder of his share of our losses will be
limited to the tax basis in his units and, in the case of an
individual unitholder, estate, trust, or corporate unitholder
(if more than 50% of the value of the corporate
unitholders stock is owned directly or indirectly by or
for five or fewer individuals or some tax-exempt organizations),
to the amount for which the unitholder is considered to be
at risk with respect to our activities, if that is
less than his tax basis. A common unitholder subject to these
limitations must recapture losses deducted in previous years to
the extent that distributions cause his at-risk amount to be
less than zero at the end of any taxable year. Losses disallowed
to a unitholder or recaptured as a result of these limitations
will carry forward and will be allowable as a deduction to the
extent that his at-risk amount is subsequently increased,
provided such losses do not exceed such common unitholders
tax basis in his common units. Upon the taxable disposition of a
unit, any gain recognized by a unitholder can be offset by
losses that were previously suspended by the at-risk limitation
but may not be offset by losses suspended by the basis
limitation. Any loss previously suspended by the at-risk
limitation in excess of that gain would no longer be utilizable.
In general, a unitholder will be at risk to the extent of the
tax basis of his units, excluding any portion of that basis
attributable to his share of our nonrecourse liabilities,
reduced by (i) any portion of that basis representing
amounts otherwise protected against loss because of a guarantee,
stop loss agreement or other similar arrangement and
(ii) any amount of money he borrows to acquire or hold his
units, if the lender of those borrowed funds owns an interest in
us, is related to the unitholder or can look only to the units
for repayment. A unitholders at-risk amount will increase
or decrease as the tax basis of the unitholders units
increases or decreases, other than tax basis increases or
decreases attributable to increases or decreases in his share of
our nonrecourse liabilities.
In addition to the basis and at-risk limitations on the
deductibility of losses, the passive loss limitations generally
provide that individuals, estates, trusts and some closely-held
corporations and personal service corporations can deduct losses
from passive activities, which are generally trade or business
activities in which the taxpayer does not materially
participate, only to the extent of the taxpayers income
from those passive activities. The passive loss limitations are
applied separately with respect to each publicly traded
partnership. Consequently, any passive losses we generate will
only be available to offset our passive income generated in the
future and will not be available to offset income from other
passive activities or investments, including our investments or
investments in other publicly traded partnerships, or salary or
active business income. Passive losses that are not deductible
because they exceed a unitholders share of income we
generate may be deducted in full when he disposes of his entire
investment in us in a fully taxable transaction with an
unrelated party. The passive loss limitations are applied after
other applicable limitations on deductions, including the
at-risk rules and the basis limitation.
A unitholders share of our net income may be offset by any
of our suspended passive losses, but it may not be offset by any
other current or carryover losses from other passive activities,
including those attributable to other publicly traded
partnerships.
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Limitations on Interest Deductions. The
deductibility of a non-corporate taxpayers
investment interest expense is generally limited to
the amount of that taxpayers net investment
income. Investment interest expense includes:
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interest on indebtedness properly allocable to property held for
investment;
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our interest expense attributed to portfolio income; and
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the portion of interest expense incurred to purchase or carry an
interest in a passive activity to the extent attributable to
portfolio income.
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The computation of a unitholders investment interest
expense will take into account interest on any margin account
borrowing or other loan incurred to purchase or carry a unit.
Net investment income includes gross income from property held
for investment and amounts treated as portfolio income under the
passive loss rules, less deductible expenses, other than
interest, directly connected with the production of investment
income, but generally does not include gains attributable to the
disposition of property held for investment or qualified
dividend income. The IRS has indicated that the net passive
income earned by a publicly traded partnership will be treated
as investment income to its unitholders. In addition, the
unitholders share of our portfolio income will be treated
as investment income.
Entity-Level Collections. If we are
required or elect under applicable law to pay any federal,
state, local or foreign income tax on behalf of any unitholder
or our general partner or any former unitholder, we are
authorized to pay those taxes from our funds. That payment, if
made, will be treated as a distribution of cash to the partner
on whose behalf the payment was made. If the payment is made on
behalf of a person whose identity cannot be determined, we are
authorized to treat the payment as a distribution to all current
unitholders. We are authorized to amend our partnership
agreement in the manner necessary to maintain uniformity of
intrinsic tax characteristics of units and to adjust later
distributions, so that after giving effect to these
distributions, the priority and characterization of
distributions otherwise applicable under our partnership
agreement is maintained as nearly as is practicable. Payments by
us as described above could give rise to an overpayment of tax
on behalf of an individual partner in which event the partner
would be required to file a claim in order to obtain a credit or
refund.
Allocation of Income, Gain, Loss and
Deduction. In general, if we have a net profit,
our items of income, gain, loss and deduction will be allocated
among our general partner and the unitholders in accordance with
their percentage interests in us. At any time that incentive
distributions are made to our general partner, gross income will
be allocated to the recipients to the extent of these
distributions. If we have a net loss, that loss will be
allocated first to the general partner and the unitholders in
accordance with their percentage interests in us to the extent
of their positive capital accounts and, second, to the general
partner.
Specified items of our income, gain, loss and deduction will be
allocated to account for (i) any difference between the tax
basis and fair market value of our assets at the time of an
offering and (ii) any difference between the tax basis and
fair market value of any property contributed to us that exists
at the time of such contribution, together, referred to in this
discussion as the Contributed Property. The effect
of these allocations, referred to as Section 704(c)
Allocations, to a unitholder purchasing common units from us in
an offering will be essentially the same as if the tax bases of
our assets were equal to their fair market value at the time of
such offering. In the event we issue additional common units or
engage in certain other transactions in the future, we will make
reverse Section 704(c) Allocations, similar to
the Section 704(c) Allocations described above, to all
holders of partnership interests immediately prior to such
issuance or other transactions to account for the difference
between the book basis for purposes of maintaining
capital accounts and the fair market value of all property held
by us at the time of such issuance or future transaction. In
addition, items of recapture income will be allocated to the
extent possible to the partner who was allocated the deduction
giving rise to the treatment of that gain as recapture income in
order to minimize the recognition of ordinary income by some
unitholders. Finally, although we do not expect that our
operations will result in the creation of negative capital
accounts, if negative capital accounts nevertheless result,
items of our income and gain will be allocated in an amount and
manner as is needed to eliminate the negative balance as quickly
as possible.
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An allocation of items of our income, gain, loss or deduction,
other than an allocation required by the Internal Revenue Code
to eliminate the difference between a partners
book capital account, credited with the fair market
value of Contributed Property, and tax capital
account, credited with the tax basis of Contributed Property,
referred to in this discussion as the Book-Tax
Disparity, will generally be given effect for federal
income tax purposes in determining a partners share of an
item of income, gain, loss or deduction only if the allocation
has substantial economic effect. In any other case, a
partners share of an item will be determined on the basis
of his interest in us, which will be determined by taking into
account all the facts and circumstances, including:
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his relative contributions to us;
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the interests of all the partners in profits and losses;
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the interest of all the partners in cash flow; and
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the rights of all the partners to distributions of capital upon
liquidation.
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Vinson & Elkins L.L.P. is of the opinion that, with
the exception of the issues described in
Section 754 Election and
Disposition of Common Units
Allocations Between Transferors and Transferees,
allocations under our partnership agreement will be given effect
for federal income tax purposes in determining a partners
share of an item of income, gain, loss or deduction.
Treatment of Short Sales. A unitholder whose
units are loaned to a short seller to cover a short
sale of units may be considered as having disposed of those
units. If so, he would no longer be treated for tax purposes as
a partner with respect to those units during the period of the
loan and may recognize gain or loss from the disposition. As a
result, during this period:
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any of our income, gain, loss or deduction with respect to those
units would not be reportable by the unitholder;
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any cash distributions received by the unitholder as to those
units would be fully taxable; and
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all of these distributions would appear to be ordinary income.
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Vinson & Elkins L.L.P. has not rendered an opinion
regarding the tax treatment of a unitholder whose common units
are loaned to a short seller to cover a short sale of common
units because there is no direct or indirect authority on the
issue related to partnership interests and without such
authority a legal opinion cannot be issued; therefore,
unitholders desiring to assure their status as partners and
avoid the risk of gain recognition from a loan to a short seller
are urged to modify any applicable brokerage account agreements
to prohibit their brokers from borrowing and loaning their
units. The IRS has announced that it is actively studying issues
relating to the tax treatment of short sales of partnership
interests. Please also read Disposition of
Common Units Recognition of Gain or Loss.
Alternative Minimum Tax. Each unitholder will
be required to take into account his distributive share of any
items of our income, gain, loss or deduction for purposes of the
alternative minimum tax. The current minimum tax rate for
noncorporate taxpayers is 26% on the first $175,000 of
alternative minimum taxable income in excess of the exemption
amount and 28% on any additional alternative minimum taxable
income. Prospective unitholders are urged to consult with their
tax advisors as to the impact of an investment in units on their
liability for the alternative minimum tax.
Tax Rates. Under current law, the highest
marginal U.S. federal income tax rate applicable to
ordinary income of individuals is 35% and the highest marginal
U.S. federal income tax rate applicable to long-term
capital gains (generally, capital gains on certain assets held
for more than 12 months) of individuals is 15%. However,
absent new legislation extending the current rates, beginning
January 1, 2011, the highest marginal U.S. federal
income tax rate applicable to ordinary income and long-term
capital gains of individuals will increase to 39.6% and 20%,
respectively. Moreover, these rates are subject to change by new
legislation at any time.
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The recently enacted Patient Protection and Affordable Care Act
will impose a 3.8% Medicare tax on certain investment income
earned by individuals for taxable years beginning after
December 31, 2012. For these purposes, investment income
generally includes a unitholders allocable share of our
income and gain realized by a unitholder from a sale of units.
The tax will be imposed on the lesser of (i) the
unitholders net income from all investments, and
(ii) the amount by which the unitholders adjusted
gross income exceeds $250,000 (if the unitholder is married and
filing jointly) or $200,000 (if the unitholder is unmarried).
Section 754 Election. We have made the
election permitted by Section 754 of the Internal Revenue
Code. That election is irrevocable without the consent of the
IRS. The election will generally permit us to adjust a common
unit purchasers tax basis in our assets (inside
basis) under Section 743(b) of the Internal Revenue
Code to reflect his purchase price of units acquired from
another unitholder. This election does not apply to a person who
purchases common units directly from us. The Section 743(b)
adjustment belongs to the purchaser and not to other
unitholders. For purposes of this discussion, a
unitholders inside basis in our assets will be considered
to have two components: (1) his share of our tax basis in
our assets (common basis) and (2) his
Section 743(b) adjustment to that basis.
Where the remedial allocation method is adopted (which we have
generally adopted as to all of our properties), the Treasury
Regulations under Section 743 of the Internal Revenue Code
require a portion of the Section 743(b) adjustment that is
attributable to recovery property subject to depreciation under
Section 168 of the Internal Revenue Code whose book basis
is in excess of its tax basis to be depreciated over the
remaining cost recovery period for the propertys
unamortized Book-Tax Disparity. Under Treasury
Regulation Section 1.167(c)-1(a)(6),
a Section 743(b) adjustment attributable to property
subject to depreciation under Section 167 of the Internal
Revenue Code, rather than cost recovery deductions under
Section 168, is generally required to be depreciated using
either the straight-line method or the 150% declining balance
method. If we elect a method other than the remedial method, the
depreciation and amortization methods and useful lives
associated with the Section 743(b) adjustment, therefore,
may differ from the methods and useful lives generally used to
depreciate the inside basis in such properties. Under our
partnership agreement, the general partner is authorized to take
a position to preserve the uniformity of units even if that
position is not consistent with these and any other Treasury
Regulations. If we elect a method other than the remedial method
with respect to a goodwill property, the common basis of such
property is not amortizable. Please see
Uniformity of Units.
Although Vinson & Elkins L.L.P. is unable to opine as
to the validity of this approach because there is no direct or
indirect controlling authority on this issue, we intend to
depreciate the portion of a Section 743(b) adjustment
attributable to unrealized appreciation in the value of
Contributed Property, to the extent of any unamortized Book-Tax
Disparity, using a rate of depreciation or amortization derived
from the depreciation or amortization method and useful life
applied to the propertys unamortized Book-Tax Disparity,
or treat that portion as
non-amortizable
to the extent attributable to property which is not amortizable.
This method is consistent with the methods employed by other
publicly traded partnerships but is arguably inconsistent with
Treasury
Regulation Section 1.167(c)-1(a)(6),
which is not expected to directly apply to a material portion of
our assets. To the extent this Section 743(b) adjustment is
attributable to appreciation in value in excess of the
unamortized Book-Tax Disparity, we will apply the rules
described in the Treasury Regulations and legislative history.
If we determine that this position cannot reasonably be taken,
we may take a depreciation or amortization position under which
all purchasers acquiring units in the same month would receive
depreciation or amortization, whether attributable to common
basis or a Section 743(b) adjustment, based upon the same
applicable rate as if they had purchased a direct interest in
our assets. This kind of aggregate approach may result in lower
annual depreciation or amortization deductions than would
otherwise be allowable to some unitholders. Please see
Uniformity of Units. A unitholders
tax basis for his common units is reduced by his share of our
deductions (whether or not such deductions were claimed on an
individuals income tax return) so that any position we
take that understates deductions will overstate the common
unitholders basis in his common units, which may cause the
unitholder to understate gain or overstate loss on any sale of
such units. Please see Disposition of Common
Units Recognition of Gain or Loss. The IRS may
challenge our position with respect to depreciating or
amortizing the Section 743(b) adjustment we take to
preserve the
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uniformity of the units. If such a challenge were sustained, the
gain from the sale of units might be increased without the
benefit of additional deductions.
A Section 754 election is advantageous if the
transferees tax basis in his units is higher than the
units share of the aggregate tax basis of our assets
immediately prior to the transfer. In that case, as a result of
the election, the transferee would have, among other items, a
greater amount of depreciation deductions and his share of any
gain or loss on a sale of our assets would be less. Conversely,
a Section 754 election is disadvantageous if the
transferees tax basis in his units is lower than those
units share of the aggregate tax basis of our assets
immediately prior to the transfer. Thus, the fair market value
of the units may be affected either favorably or unfavorably by
the election. A basis adjustment is required regardless of
whether a Section 754 election is made in the case of a
transfer of an interest in us if we have a substantial built-in
loss immediately after the transfer, or if we distribute
property and have a substantial basis reduction. Generally a
built-in loss or a basis reduction is substantial if it exceeds
$250,000.
The calculations involved in the Section 754 election are
complex and will be made on the basis of assumptions as to the
value of our assets and other matters. For example, the
allocation of the Section 743(b) adjustment among our
assets must be made in accordance with the Internal Revenue
Code. The IRS could seek to reallocate some or all of any
Section 743(b) adjustment allocated by us to our tangible
assets to goodwill instead. Goodwill, as an intangible asset, is
generally nonamortizable or amortizable over a longer period of
time or under a less accelerated method than our tangible
assets. We cannot assure you that the determinations we make
will not be successfully challenged by the IRS and that the
deductions resulting from them will not be reduced or disallowed
altogether. Should the IRS require a different basis adjustment
to be made, and should, in our opinion, the expense of
compliance exceed the benefit of the election, we may seek
permission from the IRS to revoke our Section 754 election.
If permission is granted, a subsequent purchaser of units may be
allocated more income than he would have been allocated had the
election not been revoked.
Tax
Treatment of Operations
Accounting Method and Taxable Year. We use the
year ending December 31 as our taxable year and the accrual
method of accounting for federal income tax purposes. Each
unitholder will be required to include in income his share of
our income, gain, loss and deduction for our taxable year ending
within or with his taxable year. In addition, a unitholder who
has a taxable year ending on a date other than December 31 and
who disposes of all of his units following the close of our
taxable year but before the close of his taxable year must
include his share of our income, gain, loss and deduction in
income for his taxable year, with the result that he will be
required to include in income for his taxable year his share of
more than one year of our income, gain, loss and deduction.
Please see Disposition of Common
Units Allocations Between Transferors and
Transferees.
Tax Basis, Depreciation and Amortization. The
tax basis of our assets will be used for purposes of computing
depreciation and cost recovery deductions and, ultimately, gain
or loss on the disposition of these assets. The federal income
tax burden associated with the difference between the fair
market value of our assets and their tax basis immediately prior
to a primary offering of new units will be borne by our
unitholders holding interests in us prior to any such offering.
Please see Tax Consequences of Unit
Ownership Allocation of Income, Gain, Loss and
Deduction.
To the extent allowable, we may elect to use the depreciation
and cost recovery methods that will result in the largest
deductions being taken in the early years after assets subject
to these allowances are placed in service. We may not be
entitled to amortization deductions with respect to certain
goodwill conveyed to us in future transactions or held at the
time of any future offering. Property we subsequently acquire or
construct may be depreciated using accelerated methods permitted
by the Internal Revenue Code.
If we dispose of depreciable property by sale, foreclosure or
otherwise, all or a portion of any gain, determined by reference
to the amount of depreciation previously deducted and the nature
of the property, may be subject to the recapture rules and taxed
as ordinary income rather than capital gain. Similarly, a
unitholder who has taken cost recovery or depreciation
deductions with respect to property we own will likely be
required to recapture some or all of those deductions as
ordinary income upon a sale of his interest in us.
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Please see Tax Consequences of Unit
Ownership Allocation of Income, Gain, Loss and
Deduction and Disposition of Common
Units Recognition of Gain or Loss.
The costs we incur in selling our units (called
syndication expenses) must be capitalized and cannot
be deducted currently, ratably or upon our termination. There
are uncertainties regarding the classification of costs as
organization expenses, which may be amortized by us, and as
syndication expenses, which may not be amortized by us. The
underwriting discounts and commissions we incur will be treated
as syndication expenses.
Valuation and Tax Basis of Our Properties. The
federal income tax consequences of the ownership and disposition
of units will depend in part on our estimates of the relative
fair market values, and the initial tax bases, of our assets.
Although we may from time to time consult with professional
appraisers regarding valuation matters, we will make many of the
relative fair market value estimates ourselves. These estimates
and determinations of basis are subject to challenge and will
not be binding on the IRS or the courts. If the estimates of
fair market value or basis are later found to be incorrect, the
character and amount of items of income, gain, loss or
deductions previously reported by unitholders might change, and
unitholders might be required to adjust their tax liability for
prior years and incur interest and penalties with respect to
those adjustments.
Disposition
of Common Units
Recognition of Gain or Loss. Gain or loss will
be recognized on a sale of units equal to the difference between
the amount realized and the unitholders tax basis for the
units sold. A unitholders amount realized will be measured
by the sum of the cash or the fair market value of other
property received by him plus his share of our nonrecourse
liabilities. Because the amount realized includes a
unitholders share of our nonrecourse liabilities, the gain
recognized on the sale of units could result in a tax liability
in excess of any cash received from the sale.
Prior distributions from us in excess of cumulative net taxable
income for a common unit that decreased a unitholders tax
basis in that common unit will, in effect, become taxable income
if the common unit is sold at a price greater than the
unitholders tax basis in that common unit, even if the
price received is less than his original cost.
Except as noted below, gain or loss recognized by a unitholder,
other than a dealer in units, on the sale or
exchange of a unit will generally be taxable as capital gain or
loss. Capital gain recognized by an individual on the sale of
units held for more than twelve months will generally be taxed
at a maximum U.S. federal income tax rate of 15% through
December 31, 2010 and 20% thereafter (absent new
legislation extending or adjusting the current rate). However, a
portion, which will likely be substantial, of this gain or loss
will be separately computed and taxed as ordinary income or loss
under Section 751 of the Internal Revenue Code to the
extent attributable to assets giving rise to depreciation
recapture or other unrealized receivables or to
inventory items we own. The term unrealized
receivables includes potential recapture items, including
depreciation recapture. Ordinary income attributable to
unrealized receivables, inventory items and depreciation
recapture may exceed net taxable gain realized upon the sale of
a unit and may be recognized even if there is a net taxable loss
realized on the sale of a unit. Thus, a unitholder may recognize
both ordinary income and a capital loss upon a sale of units.
Net capital losses may offset capital gains and no more than
$3,000 of ordinary income, in the case of individuals, and may
only be used to offset capital gains in the case of corporations.
The IRS has ruled that a partner who acquires interests in a
partnership in separate transactions must combine those
interests and maintain a single adjusted tax basis for all those
interests. Upon a sale or other disposition of less than all of
those interests, a portion of that tax basis must be allocated
to the interests sold using an equitable
apportionment method, which generally means that the tax
basis allocated to the interest sold equals an amount that bears
the same relation to the partners tax basis in his entire
interest in the partnership as the value of the interest sold
bears to the value of the partners entire interest in the
partnership. Treasury Regulations under Section 1223 of the
Internal Revenue Code allow a selling unitholder who can
identify common units transferred with an ascertainable holding
period to elect to use the actual holding
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period of the common units transferred. Thus, according to the
ruling discussed above, a common unitholder will be unable to
select high or low basis common units to sell as would be the
case with corporate stock, but, according to the Treasury
Regulations, he may designate specific common units sold for
purposes of determining the holding period of units transferred.
A unitholder electing to use the actual holding period of common
units transferred must consistently use that identification
method for all subsequent sales or exchanges of common units. A
unitholder considering the purchase of additional units or a
sale of common units purchased in separate transactions is urged
to consult his tax advisor as to the possible consequences of
this ruling and application of the Treasury Regulations.
Specific provisions of the Internal Revenue Code affect the
taxation of some financial products and securities, including
partnership interests, by treating a taxpayer as having sold an
appreciated partnership interest, one in which gain
would be recognized if it were sold, assigned or terminated at
its fair market value, if the taxpayer or related persons
enter(s) into:
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a short sale;
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an offsetting notional principal contract; or
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a futures or forward contract with respect to the partnership
interest or substantially identical property.
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Moreover, if a taxpayer has previously entered into a short
sale, an offsetting notional principal contract or a futures or
forward contract with respect to the partnership interest, the
taxpayer will be treated as having sold that position if the
taxpayer or a related person then acquires the partnership
interest or substantially identical property. The Secretary of
the Treasury is also authorized to issue regulations that treat
a taxpayer that enters into transactions or positions that have
substantially the same effect as the preceding transactions as
having constructively sold the financial position.
Allocations Between Transferors and
Transferees. In general, our taxable income and
losses will be determined annually, will be prorated on a
monthly basis and will be subsequently apportioned among the
unitholders in proportion to the number of units owned by each
of them as of the opening of the applicable exchange on the
first business day of the month, which we refer to in this
prospectus as the Allocation Date. However, gain or
loss realized on a sale or other disposition of our assets other
than in the ordinary course of business will be allocated among
the unitholders on the Allocation Date in the month in which
that gain or loss is recognized. As a result, a unitholder
transferring units may be allocated income, gain, loss and
deduction realized after the date of transfer.
Although simplifying conventions are contemplated by the
Internal Revenue Code and most publicly traded partnerships use
similar simplifying conventions, the use of this method may not
be permitted under existing Treasury Regulations. Recently,
however, the Department of the Treasury and the IRS issued
proposed Treasury Regulations that provide a safe harbor
pursuant to which a publicly traded partnership may use a
similar monthly simplifying convention to allocate tax items
among transferor and transferee unitholders, although such tax
items must be prorated on a daily basis. Nonetheless, the
proposed regulations do not specifically authorize the use of
the proration method we have adopted. Existing publicly traded
partnerships are entitled to rely on these proposed Treasury
Regulations; however, they are not binding on the IRS and are
subject to change until final Treasury Regulations are issued.
Accordingly, Vinson & Elkins L.L.P. is unable to opine
on the validity of this method of allocating income and
deductions between transferor and transferee unitholders. If
this method is not allowed under the Treasury Regulations, or
only applies to transfers of less than all of the
unitholders interest, our taxable income or losses might
be reallocated among the unitholders. We are authorized to
revise our method of allocation between transferor and
transferee unitholders, as well as unitholders whose interests
vary during a taxable year, to conform to a method permitted
under future Treasury Regulations.
A unitholder who owns units at any time during a quarter and who
disposes of them prior to the record date set for a cash
distribution for that quarter will be allocated items of our
income, gain, loss and deductions attributable to that quarter
but will not be entitled to receive that cash distribution.
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Notification Requirements. A unitholder who
sells any of his units is generally required to notify us in
writing of that sale within 30 days after the sale (or, if
earlier, January 15 of the year following the sale). A purchaser
of units who purchases units from another unitholder is also
generally required to notify us in writing of that purchase
within 30 days after the purchase. Upon receiving such
notifications, we are required to notify the IRS of that
transaction and to furnish specified information to the
transferor and transferee. Failure to notify us of a purchase
may, in some cases, lead to the imposition of penalties.
However, these reporting requirements do not apply to a sale by
an individual who is a citizen of the United States and who
effects the sale or exchange through a broker who will satisfy
such requirements.
Constructive Termination. We will be
considered to have been terminated for tax purposes if there are
sales or exchanges which, in the aggregate, constitute 50% or
more of the total interests in our capital and profits within a
twelve-month period. For purposes of measuring whether the 50%
threshold is reached, multiple sales of the same interest are
counted only once. A constructive termination results in the
closing of our taxable year for all unitholders. In the case of
a unitholder reporting on a taxable year other than a fiscal
year ending December 31, the closing of our taxable year
may result in more than twelve months of our taxable income or
loss being includable in his taxable income for the year of
termination. A constructive termination occurring on a date
other than December 31 will result in us filing two tax returns
(and common unitholders may receive two Schedules K-1) for one
fiscal year and the cost of the preparation of these returns
will be borne by all common unitholders. We would be required to
make new tax elections after a termination, including a new
election under Section 754 of the Internal Revenue Code,
and a termination would result in a deferral of our deductions
for depreciation. A termination could also result in penalties
if we were unable to determine that the termination had
occurred. Moreover, a termination might either accelerate the
application of, or subject us to, any tax legislation enacted
before the termination. The IRS has recently announced a relief
procedure whereby if a publicly traded partnership that has
technically terminated requests and the IRS grants special
relief, among other things, the partnership will be required to
provide only a single
Schedule K-1
to a unitholder for the tax years in which the termination
occurs.
Uniformity
of Units
Because we cannot match transferors and transferees of units, we
must maintain uniformity of the economic and tax characteristics
of the units to a purchaser of these units. In the absence of
uniformity, we may be unable to completely comply with a number
of federal income tax requirements, both statutory and
regulatory. A lack of uniformity can result from a literal
application of Treasury
Regulation Section 1.167(c)-1(a)(6).
Any non-uniformity could have a negative impact on the value of
the units. Please see Tax Consequences of Unit
Ownership Section 754 Election.
We intend to depreciate the portion of a Section 743(b)
adjustment attributable to unrealized appreciation in the value
of Contributed Property, to the extent of any unamortized
Book-Tax Disparity, using a rate of depreciation or amortization
derived from the depreciation or amortization method and useful
life applied to the propertys unamortized Book-Tax
Disparity, or treat that portion as nonamortizable, to the
extent attributable to property the common basis of which is not
amortizable, consistent with the regulations under
Section 743 of the Internal Revenue Code, even though that
position may be inconsistent with Treasury
Regulation Section 1.167(c)-1(a)(6),
which is not expected to directly apply to a material portion of
our assets. Please see Tax Consequences of
Unit Ownership Section 754 Election. To
the extent that the Section 743(b) adjustment is
attributable to appreciation in value in excess of the
unamortized Book-Tax Disparity, we will apply the rules
described in the Treasury Regulations and legislative history.
If we determine that this position cannot reasonably be taken,
we may adopt a depreciation and amortization position under
which all purchasers acquiring units in the same month would
receive depreciation and amortization deductions, whether
attributable to a common basis or Section 743(b)
adjustment, based upon the same applicable methods and lives as
if they had purchased a direct interest in our property. If this
position is adopted, it may result in lower annual depreciation
and amortization deductions than would otherwise be allowable to
some unitholders and risk the loss of depreciation and
amortization deductions not taken in the year that these
deductions are otherwise allowable. This position will not be
adopted if we determine that the loss of depreciation and
amortization deductions will have a material adverse effect on
the unitholders. If we
42
choose not to utilize this aggregate method, we may use any
other reasonable depreciation and amortization method to
preserve the uniformity of the intrinsic tax characteristics of
any units that would not have a material adverse effect on the
unitholders. The IRS may challenge any method of depreciating
the Section 743(b) adjustment described in this paragraph.
If this challenge were sustained, the uniformity of units might
be affected, and the gain from the sale of units might be
increased without the benefit of additional deductions. Please
see Disposition of Common Units
Recognition of Gain or Loss.
Tax-Exempt
Organizations and Other Investors
Ownership of units by employee benefit plans, other tax-exempt
organizations, non-resident aliens, foreign corporations and
other
non-U.S. persons
raises issues unique to those investors and, as described below,
may have substantially adverse tax consequences to them. If you
are a tax-exempt entity or a
non-U.S. person,
you should consult your tax advisor before investing in our
common units.
Employee benefit plans and most other organizations exempt from
federal income tax, including individual retirement accounts and
other retirement plans, are subject to federal income tax on
unrelated business taxable income. Virtually all of our income
less certain allowable deductions allocated to a unitholder that
is a tax-exempt organization will be unrelated business taxable
income and will be taxable to it.
Non-resident aliens and foreign corporations, trusts or estates
that own units will be considered to be engaged in business in
the United States because of the ownership of units. As a
consequence, they will be required to file federal tax returns
to report their share of our income, gain, loss or deduction and
pay federal income tax at regular rates on their share of our
net income or gain. Moreover, under rules applicable to publicly
traded partnerships, distributions to
non-U.S. unitholders
are subject to withholding at the highest applicable effective
tax rate. Each
non-U.S. unitholder
must obtain a taxpayer identification number from the IRS and
submit that number to our transfer agent on a
Form W-8BEN
or applicable substitute form in order to obtain credit for
these withholding taxes. A change in applicable law may require
us to change these procedures.
In addition, because a foreign corporation that owns units will
be treated as engaged in a United States trade or business, that
corporation may be subject to the United States branch profits
tax at a rate of 30%, in addition to regular federal income tax,
on its share of our income and gain, as adjusted for changes in
the foreign corporations U.S. net equity,
which are effectively connected with the conduct of a United
States trade or business. That tax may be reduced or eliminated
by an income tax treaty between the United States and the
country in which the foreign corporate unitholder is a
qualified resident. In addition, this type of
unitholder is subject to special information reporting
requirements under Section 6038C of the Internal Revenue
Code.
A foreign unitholder who sells or otherwise disposes of a common
unit will be subject to U.S. federal income tax on gain
realized from the sale or disposition of that unit to the extent
the gain is effectively connected with a U.S. trade or
business of the foreign unitholder. Under a ruling published by
the IRS, interpreting the scope of effectively connected
income, a foreign unitholder would be considered to be
engaged in a trade or business in the U.S. by virtue of the
U.S. activities of the partnership, and part or all of that
unitholders gain would be effectively connected with that
unitholders indirect U.S. trade or business.
Moreover, under the Foreign Investment in Real Property Tax Act,
a foreign common unitholder generally will be subject to
U.S. federal income tax upon the sale or disposition of a
common unit if (i) he owned (directly or constructively
applying certain attribution rules) more than 5% of our common
units at any time during the five-year period ending on the date
of such disposition and (ii) 50% or more of the fair market
value of all of our assets consisted of U.S. real property
interests at any time during the shorter of the period during
which such unitholder held the common units or the
5-year
period ending on the date of disposition. Currently, more than
50% of our assets consist of U.S. real property interests
and we do not expect that to change in the foreseeable future.
Therefore, foreign unitholders may be subject to federal income
tax on gain from the sale or disposition of their units.
43
Administrative
Matters
Information Returns and Audit Procedures. We
intend to furnish to each unitholder, within 90 days after
the close of each calendar year, specific tax information,
including a
Schedule K-1,
which describes his share of our income, gain, loss and
deduction for our preceding taxable year. In preparing this
information, which will not be reviewed by counsel, we will take
various accounting and reporting positions, some of which have
been mentioned earlier, to determine each unitholders
share of income, gain, loss and deduction. We cannot assure you
that those positions will in all cases yield a result that
conforms to the requirements of the Internal Revenue Code,
Treasury Regulations or administrative interpretations of the
IRS. Neither we nor Vinson & Elkins L.L.P. can assure
prospective unitholders that the IRS will not successfully
contend in court that those positions are impermissible. Any
challenge by the IRS could negatively affect the value of the
units.
The IRS may audit our federal income tax information returns.
Adjustments resulting from an IRS audit may require each
unitholder to adjust a prior years tax liability, and
possibly may result in an audit of his return. Any audit of a
unitholders return could result in adjustments not related
to our returns as well as those related to our returns.
Partnerships generally are treated as separate entities for
purposes of federal tax audits, judicial review of
administrative adjustments by the IRS and tax settlement
proceedings. The tax treatment of partnership items of income,
gain, loss and deduction are determined in a partnership
proceeding rather than in separate proceedings with the
partners. The Internal Revenue Code requires that one partner be
designated as the Tax Matters Partner for these
purposes. Our partnership agreement names our general partner as
our Tax Matters Partner.
The Tax Matters Partner has made and will make some elections on
our behalf and on behalf of unitholders. In addition, the Tax
Matters Partner can extend the statute of limitations for
assessment of tax deficiencies against unitholders for items in
our returns. The Tax Matters Partner may bind a unitholder with
less than a 1% profits interest in us to a settlement with the
IRS unless that unitholder elects, by filing a statement with
the IRS, not to give that authority to the Tax Matters Partner.
The Tax Matters Partner may seek judicial review, by which all
the unitholders are bound, of a final partnership administrative
adjustment and, if the Tax Matters Partner fails to seek
judicial review, judicial review may be sought by any unitholder
having at least a 1% interest in profits or by any group of
unitholders having in the aggregate at least a 5% interest in
profits. However, only one action for judicial review will go
forward, and each unitholder with an interest in the outcome may
participate.
A unitholder must file a statement with the IRS identifying the
treatment of any item on his federal income tax return that is
not consistent with the treatment of the item on our return.
Intentional or negligent disregard of this consistency
requirement may subject a unitholder to substantial penalties.
Nominee Reporting. Persons who hold an
interest in us as a nominee for another person are required to
furnish to us:
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the name, address and taxpayer identification number of the
beneficial owner and the nominee;
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whether the beneficial owner is:
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a person that is not a United States person;
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a foreign government, an international organization or any
wholly owned agency or instrumentality of either of the
foregoing; or
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a tax-exempt entity;
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the amount and description of units held, acquired or
transferred for the beneficial owner; and
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specific information including the dates of acquisitions and
transfers, means of acquisitions and transfers, and acquisition
cost for purchases, as well as the amount of net proceeds from
sales.
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Brokers and financial institutions are required to furnish
additional information, including whether they are United States
persons and specific information on units they acquire, hold or
transfer for their own
44
account. A penalty of $50 per failure, up to a maximum of
$100,000 per calendar year, is imposed by the Internal Revenue
Code for failure to report that information to us. The nominee
is required to supply the beneficial owner of the units with the
information furnished to us.
Accuracy-Related Penalties. An additional tax
equal to 20% of the amount of any portion of an underpayment of
tax that is attributable to one or more specified causes,
including negligence or disregard of rules or regulations,
substantial understatements of income tax and substantial
valuation misstatements, is imposed by the Internal Revenue
Code. No penalty will be imposed, however, for any portion of an
underpayment if it is shown that there was a reasonable cause
for that portion and that the taxpayer acted in good faith
regarding that portion.
For individuals, a substantial understatement of income tax in
any taxable year exists if the amount of the understatement
exceeds the greater of 10% of the tax required to be shown on
the return for the taxable year or $5,000 ($10,000 for most
corporations). The amount of any understatement subject to
penalty generally is reduced if any portion is attributable to a
position adopted on the return:
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for which there is, or was, substantial
authority; or
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as to which there is a reasonable basis and the pertinent facts
of that position are disclosed on the return.
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If any item of income, gain, loss or deduction included in the
distributive shares of unitholders might result in that kind of
an understatement of income for which no
substantial authority exists, we must disclose the
pertinent facts on our return. In addition, we will make a
reasonable effort to furnish sufficient information for
unitholders to make adequate disclosure on their returns and to
take other actions as may be appropriate to permit unitholders
to avoid liability for this penalty. More stringent rules apply
to tax shelters, which we do not believe includes us
or any of our investments, plans or arrangements.
A substantial valuation misstatement exists if (a) the
value of any property, or the tax basis of any property, claimed
on a tax return is 150% or more of the amount determined to be
the correct amount of the valuation or tax basis, (b) the
price for any property or services (or for the use of property)
claimed on any such return with respect to any transaction
between persons described in Internal Revenue Code
Section 482 is 200% or more (or 50% or less) of the amount
determined under Section 482 to be the correct amount of
such price, or (c) the net Internal Revenue Code
Section 482 transfer price adjustment for the taxable year
exceeds the lesser of $5 million or 10% of the
taxpayers gross receipts. No penalty is imposed unless the
portion of the underpayment attributable to a substantial
valuation misstatement exceeds $5,000 ($10,000 for most
corporations). The penalty is increased to 40% in the event of a
gross valuation misstatement. We do not anticipate making any
valuation misstatements.
Reportable Transactions. If we were to engage
in a reportable transaction, we (and possibly you
and others) would be required to make a detailed disclosure of
the transaction to the IRS. A transaction may be a reportable
transaction based upon any of several factors, including the
fact that it is a type of tax avoidance transaction publicly
identified by the IRS as a listed transaction or
that it produces certain kinds of losses for partnerships,
individuals, S corporations, and trusts in excess of
$2 million in any single year, or $4 million in any
combination of six successive tax years. Our participation in a
reportable transaction could increase the likelihood that our
federal income tax information return (and possibly your tax
return) would be audited by the IRS. Please see
Information Returns and Audit Procedures.
Moreover, if we were to participate in a reportable transaction
with a significant purpose to avoid or evade tax, or in any
listed transaction, you may be subject to the following
provisions of the American Jobs Creation Act of 2004:
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accuracy-related penalties with a broader scope, significantly
narrower exceptions, and potentially greater amounts than
described above at Accuracy-Related
Penalties;
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for those persons otherwise entitled to deduct interest on
federal tax deficiencies, nondeductibility of interest on any
resulting tax liability; and
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in the case of a listed transaction, an extended statute of
limitations.
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We do not expect to engage in any reportable
transactions.
State,
Local, Foreign and Other Tax Consequences
In addition to federal income taxes, you may be subject to other
taxes, such as state, local and foreign income taxes,
unincorporated business taxes, and estate, inheritance or
intangible taxes that may be imposed by the various
jurisdictions in which we do business or own property or in
which you are a resident. Although an analysis of those various
taxes is not presented here, each prospective unitholder should
consider their potential impact on his investment in us. We
currently own property and do business in Texas and Louisiana,
as well as other states. Currently, Texas does not impose a
personal income tax on individuals but Louisiana does. Moreover,
both states impose entity level taxes on corporations and other
entities. Current law may change. Moreover, we may also own
property or do business in other jurisdictions in the future.
Although you may not be required to file a return and pay taxes
in some jurisdictions because your income from that jurisdiction
falls below the filing and payment requirement, you might be
required to file income tax returns and to pay income taxes in
other jurisdictions in which we do business or own property, now
or in the future, and may be subject to penalties for failure to
comply with those requirements. In some jurisdictions, tax
losses may not produce a tax benefit in the year incurred and
may not be available to offset income in subsequent taxable
years. Some jurisdictions may require us, or we may elect, to
withhold a percentage of income from amounts to be distributed
to a unitholder who is not a resident of the jurisdiction.
Withholding, the amount of which may be greater or less than a
particular unitholders income tax liability to the
jurisdiction, generally does not relieve a nonresident
unitholder from the obligation to file an income tax return.
Amounts withheld will be treated as if distributed to
unitholders for purposes of determining the amounts distributed
by us. Please see Tax Consequences of Unit
Ownership Entity-Level Collections. Based
on current law and our estimate of our future operations, the
general partner anticipates that any amounts required to be
withheld will not be material.
It is the responsibility of each unitholder to investigate the
legal and tax consequences, under the laws of pertinent
jurisdictions, of his investment in us. Accordingly, each
prospective unitholder is urged to consult, and depend upon, his
tax counsel or other advisor with regard to those matters.
Further, it is the responsibility of each unitholder to file all
state, local and foreign, as well as United States federal tax
returns, that may be required of him. Vinson & Elkins
L.L.P. has not rendered an opinion on the state, local or
foreign tax consequences of an investment in us.
Tax
Consequences of Ownership of Debt Securities
A description of the material federal income tax consequences of
the acquisition, ownership and disposition of debt securities
will be set forth on the prospectus supplement relating to the
offering of debt securities.
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SELLING
UNITHOLDERS
We are registering for resale an indeterminate number of our
common units held by certain of our unitholders to be named in a
prospectus supplement.
The prospectus supplement for any offering of our common units
by a selling unitholder hereunder will include, among other
things, the following information:
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the name of the each selling unitholder;
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the nature of any position, office or other material
relationship which each selling unitholder has had within the
last three years with us or any of our predecessors or
affiliates;
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the number of common units held by each selling unitholder prior
to the offering;
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the number of common units to be offered for each selling
unitholders account; and
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the number and (if one percent or more) the percentage of common
units held by each of the selling unitholders after the offering.
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47
INVESTMENT
IN TARGA RESOURCES PARTNERS LP BY EMPLOYEE BENEFIT
PLANS
An investment in us by an employee benefit plan is subject to
additional considerations because the investments of these plans
are subject to the fiduciary responsibility provisions of ERISA
and the prohibited transaction provisions of ERISA and the
Internal Revenue Code. For these purposes the term
employee benefit plan includes, but is not limited
to, qualified pension, profit-sharing, and stock bonus plans,
certain Keogh plans, certain simplified employee pension plans,
and tax deferred annuities or IRAs established or maintained by
an employer or employee organization. Among other things,
consideration should be given to:
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whether the investment is prudent under
Section 404(a)(1)(B) of ERISA;
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whether in making the investment, that plan will satisfy the
diversification requirements of Section 404(a)(1)(C) of
ERISA;
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whether the investment is permitted under the terms of the
applicable documents governing the plan;
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whether the investment will constitute a prohibited
transaction under Section 406 of ERISA and
Section 4975 of the Internal Revenue Code (see below);
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whether in making the investment, that plan will be considered
to hold as plan assets (1) only the investment in our
partnership units or (2) an undivided interest in our
underlying assets (see below); and
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whether the investment will result in recognition of unrelated
business taxable income by the plan and, if so, the potential
after-tax investment return. Please see Material Income
Tax Consequences Tax-Exempt Organizations and Other
Investors.
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The person with investment discretion with respect to the assets
of an employee benefit plan, often called a fiduciary, should
determine whether an investment in us is authorized by the
appropriate governing instrument and is a proper investment for
the plan.
Section 406 of ERISA and Section 4975 of the Internal
Revenue Code prohibit employee benefit plans, and also IRAs and
certain other types of accounts that are not considered part of
an ERISA employee benefit plan, from engaging in specified
prohibited transactions involving plan
assets with parties that are parties in
interest under ERISA or disqualified persons
under the Internal Revenue Code with respect to the plan.
In addition to considering whether the purchase of common units
is a prohibited transaction, a fiduciary of an employee benefit
plan should consider whether the plan will, by investing in us,
be deemed to own an undivided interest in our assets, with the
result that our general partner would become an ERISA fiduciary
of the investing plan and that our operations would be subject
to the regulatory restrictions of ERISA, including its
prohibited transaction rules, as well as the prohibited
transaction rules of the Internal Revenue Code.
The Department of Labor regulations provide guidance with
respect to whether the assets of an entity in which employee
benefit plans acquire equity interests would be deemed
plan assets under some circumstances. Under these
regulations, an entitys assets generally would not be
considered to be plan assets if, among other things:
(a) the equity interests acquired by employee benefit plans
are publicly offered securities i.e., the equity
interests are part of a class of securities that is widely held
by 100 or more investors independent of the issuer and each
other, are freely transferable (as defined in the
Department of Labor regulations), and are either registered
under certain provisions of the federal securities laws or sold
to the plan as part of a public offering under certain
conditions;
(b) the entity is an operating
company, i.e., it is primarily engaged in the
production or sale of a product or service other than the
investment of capital either directly or through a
majority-owned subsidiary or subsidiaries; or
(c) there is no significant investment by benefit plan
investors, which is defined to mean that immediately after the
most recent acquisition by a plan of any equity interest in the
entity, less than 25% of the value of each class of equity
interest (disregarding interests held by our general partner,
its
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affiliates, and some other persons) is held by the employee
benefit plans referred to above, IRAs and certain other plans
and accounts not subject to ERISA (including governmental
plans), and entities whose underlying assets include plan assets
by reason of a plans investment in the entity.
Our assets should not be considered plan assets
under these regulations because it is expected that any
investment in us by an employee benefit plan will satisfy the
requirements in (a) above.
Plan fiduciaries contemplating a purchase of our common units
should consult with their own counsel regarding the consequences
under ERISA and the Internal Revenue Code in light of the
serious penalties imposed on persons who engage in prohibited
transactions or other ERISA violations.
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PLAN OF
DISTRIBUTION
We or selling unitholders will sell the securities being offered
hereby through underwriters on a firm commitment basis.
The prospectus supplement with respect to any offering of
securities will set forth the terms of the offering, including:
(i) the name or names of any underwriters; (ii) the
purchase price of the securities and the proceeds to us and, if
applicable, any selling unitholder from the sale; (iii) any
underwriting discounts and commissions and other items
constituting underwriters compensation; and (iv) any
delayed delivery arrangements.
We and, if applicable, the selling unitholders will enter into
an underwriting agreement with the underwriters at the time of
sale to them. We will set forth the names of these underwriters
and the terms of the transaction in the prospectus supplement,
which will be used by the underwriters to make resales of the
securities in respect of which this prospectus is delivered to
the public. We and, if applicable, the selling unitholders may
indemnify the underwriters under the relevant underwriting
agreement against specific liabilities, including liabilities
under the Securities Act. The underwriters may also be our
customers or may engage in transactions with or perform services
for us in the ordinary course of business.
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LEGAL
MATTERS
The validity of the securities offered in this prospectus will
be passed upon for us by Vinson & Elkins L.L.P.,
Houston, Texas. Vinson & Elkins L.L.P. will also
render an opinion on the material federal income tax
consequences regarding the securities. If certain legal matters
in connection with an offering of the securities made by this
prospectus and a related prospectus supplement are passed on by
counsel for the underwriters of such offering, that counsel will
be named in the applicable prospectus supplement related to that
offering.
EXPERTS
The financial statements and managements assessment of the
effectiveness of internal control over financial reporting
(which is included in Managements Report on Internal
Control over Financial Reporting) incorporated in this
prospectus by reference to the Annual Report on
Form 10-K
of Targa Resources Partners LP for the year ended
December 31, 2009, the balance sheet of Targa Resources GP
LLC as of December 31, 2009 included as Exhibit 99.1
of Targa Resources Partners LPs Current Report on
Form 8-K
dated March 5, 2010 have been so incorporated in reliance
on the reports (which reports contain explanatory paragraphs
relating to Targa Resources Partners LPs and Targa
Resources GP LLCs significant transactions with related
parties) of PricewaterhouseCoopers LLP, an independent
registered public accounting firm, given on the authority of
said firm as experts in auditing and accounting.
WHERE YOU
CAN FIND MORE INFORMATION
We have filed a registration statement with the SEC under the
Securities Act that registers the offer and sale of the
securities covered by this prospectus. The registration
statement, including the attached exhibits, contains additional
relevant information about us. The rules and regulations of the
SEC allow us to omit some information included in the
registration statement from this prospectus.
In addition, Targa Resources Partners LP files annual, quarterly
and other reports and other information with the SEC. You may
read and copy any document we file with the SEC at the
SECs public reference room at 100 F Street,
N.E., Washington, D.C. 20549. Please call the SEC at
1-800-732-0330
for further information on the operation of the SECs
public reference room. Our SEC filings are available on the
SECs web site at
http://www.sec.gov.
We also make available free of charge on our website, at
http://www.targaresources.com,
all materials that we file electronically with the SEC,
including our annual report on
Form 10-K,
quarterly reports on
Form 10-Q,
current reports on
Form 8-K,
Section 16 reports and amendments to these reports as soon
as reasonably practicable after such materials are
electronically filed with, or furnished to, the SEC. You also
can obtain information about us at the offices of the New York
Stock Exchange, 20 Broad Street, New York, New York 10005.
We incorporate by reference information into this
prospectus, which means that we disclose important information
to you by referring you to another document filed separately
with the SEC. The information incorporated by reference is
deemed to be part of this prospectus, except for any information
superseded by information contained expressly in this
prospectus, and the information we file later with the SEC will
automatically supersede this information. You should not assume
that (i) the information incorporated by reference in this
prospectus is accurate as of any date other than the respective
date of the documents incorporated by reference or (ii) the
information contained in this prospectus is accurate as of any
date other that the date on the front page of this prospectus.
We incorporate by reference in this prospectus the documents
listed below and any future filings made by Targa Resources
Partners LP with the SEC under Section 13(a), 13(c), 14 or
15(d) of the Exchange Act (excluding any information furnished
and not filed pursuant to 2.02 or 7.01 on any current report on
Form 8-K),
until the termination of each offering under this prospectus:
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our annual report on
Form 10-K
for the year ended December 31, 2009;
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our current reports on
Forms 8-K
filed January 15, 2010, February 11, 2010,
March 5, 2010 and April 1, 2010; and
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51
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the description of our common units in our registration
statement on
Form 8-A
(File No.
001-33303)
filed pursuant to the Exchange Act on January 21, 2010.
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You may obtain any of the documents incorporated by reference in
this prospectus from the SEC through the SECs website at
the address provided above. You also may request a copy of any
document incorporated by reference in this prospectus (including
exhibits to those documents specifically incorporated by
reference in this document), at no cost, by visiting our
internet website at www.targaresources.com, or by writing or
calling us at the following address:
Targa Resources Partners LP
1000 Louisiana St., Suite 4300
Houston, Texas 77002
Attention: Investor Relations
Telephone:
(713) 584-1000
52
PART II
INFORMATION
NOT REQUIRED IN PROSPECTUS
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Item 14.
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Other
Expenses of Issuance and Distribution
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Set forth below are the expenses (other than underwriting
discounts and commissions) expected to be incurred in connection
with the issuance and distribution of the securities registered
hereby. With the exception of the Securities and Exchange
Commission registration fee, the amounts set forth below are
estimates:
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Securities and Exchange Commission registration fee
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*
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Legal fees and expenses
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**
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Accounting fees and expenses
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**
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Printing and engraving expenses
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**
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Miscellaneous
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**
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Total
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$
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**
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* |
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The registrant is deferring payment of the registration fee in
reliance on Rule 456(b) and Rule 457(r). |
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** |
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These fees are calculated based on the number of issuances and
amount of securities offered and accordingly cannot be estimated
at this time. |
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Item 15.
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Indemnification
of Directors and Officers
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Section 17-108
of the Delaware Revised Uniform Limited Partnership Act empowers
a Delaware limited partnership to indemnify and hold harmless
any partner or other persons from and against any and all claims
and demands whatsoever. The partnership agreement of Targa
Resources Partners LP provides that the partnership will, to the
fullest extent permitted by law but subject to the limitations
expressly provided therein, indemnify and hold harmless its
general partner, any Departing General Partner (as defined
therein), any person who is or was an affiliate of the general
partner or any Departing General Partner, any person who is or
was a member, partner, officer, director, fiduciary or trustee
of the general partner, any Departing General Partner, any Group
Member (as defined therein) or any affiliate of the general
partner, any Departing General Partner or any Group Member, or
any person who is or was serving at the request of the general
partner or any affiliate of the general partner, or any
Departing General Partner or any affiliate of any Departing
General Partner as an officer, director, member, partner,
fiduciary or trustee of another person, or any person that the
general partner designates as a Partnership Indemnitee for
purposes of the partnership agreement (each, a Partnership
Indemnitee) from and against any and all losses, claims,
damages, liabilities (joint or several), expenses (including
legal fees and expenses), judgments, fines, penalties, interest,
settlements or other amounts arising from any and all claims,
demands, actions, suits or proceedings, whether civil, criminal,
administrative or investigative, in which any Partnership
Indemnitee may be involved, or is threatened to be involved, as
a party or otherwise, by reason of its status as a Partnership
Indemnitee, provided that the Partnership Indemnitee shall not
be indemnified and held harmless if there has been a final and
non-appealable judgment entered by a court of competent
jurisdiction determining that, in respect of the matter for
which the Partnership Indemnitee is seeking indemnification, the
Partnership Indemnitee acted in bad faith or engaged in fraud,
willful misconduct or, in the case of a criminal matter, acted
with knowledge that the Partnership Indemnitees conduct
was unlawful. This indemnification would under certain
circumstances include indemnification for liabilities under the
Securities Act. To the fullest extent permitted by law, expenses
(including legal fees and expenses) incurred by a Partnership
Indemnitee who is indemnified pursuant to the partnership
agreement in defending any claim, demand, action, suit or
proceeding shall, from time to time, be advanced by the
partnership prior to a determination that the Partnership
Indemnitee is not entitled to be indemnified upon receipt by the
partnership of any undertaking by or on behalf of the
Partnership Indemnitee to repay such amount if it shall be
determined that the Partnership Indemnitee is not entitled to be
indemnified under the partnership agreement. Any indemnification
under these provisions will be only out of the assets of the
partnership.
II-1
Targa Resources Partners LP is authorized to purchase (or to
reimburse its general partner or its affiliates for the costs
of) insurance against liabilities asserted against and expenses
incurred by its general partner, its affiliates and such other
persons as its general partner may determine and described in
the paragraph above in connection with their activities, whether
or not they would have the power to indemnify such person
against such liabilities under the provisions described in the
paragraphs above. Targa Resources Partners LPs general
partner has purchased insurance covering its officers and
directors against liabilities asserted and expenses incurred in
connection with their activities as officers and directors of
the general partner or any of its direct or indirect
subsidiaries.
Targa Resources Partners LP and Targa Resources GP LLC have
entered into Indemnification Agreements (each, an
Indemnification Agreement) with each independent
director of Targa Resources GP LLC (each, an
Indemnitee). Each Indemnification Agreement provides
that each of the Partnership and Targa Resources GP LLC will
indemnify and hold harmless each Indemnitee against Expenses (as
defined in the Indemnification Agreement) to the fullest extent
permitted or authorized by law, including the Delaware Revised
Uniform Limited Partnership Act and the Delaware Limited
Liability Company Act in effect on the date of the agreement or
as such laws may be amended to provide more advantageous rights
to the Indemnitee. If such indemnification is unavailable as a
result of a court decision and if the Partnership or Targa
Resources GP LLC is jointly liable in the proceeding with the
Indemnitee, the Partnership and Targa Resources GP LLC will
contribute funds to the Indemnitee for his Expenses in
proportion to relative benefit and fault of the Partnership or
Targa Resources GP LLC on the one hand and Indemnitee on the
other in the transaction giving rise to the proceeding.
Each Indemnification Agreement also provides that each of the
Partnership and Targa Resources GP LLC will indemnify and hold
harmless the Indemnitee against Expenses incurred for actions
taken as a director or officer of the Partnership or Targa
Resources GP LLC, or for serving at the request of the
Partnership or Targa Resources GP LLC as a director or officer
or another position at another corporation or enterprise, as the
case may be, but only if no final and non-appealable judgment
has been entered by a court determining that, in respect of the
matter for which the Indemnitee is seeking indemnification, the
Indemnitee acted in bad faith or engaged in fraud or willful
misconduct or, in the case of a criminal proceeding, the
Indemnitee acted with knowledge that the Indemnitees
conduct was unlawful. The Indemnification Agreement also
provides that the Partnership and Targa Resources GP LLC must
advance payment of certain Expenses to the Indemnitee, including
fees of counsel, subject to receipt of an undertaking from the
Indemnitee to return such advance if it is ultimately determined
that the Indemnitee is not entitled to indemnification.
Targa Resources Investments Inc. (Targa
Investments), the indirect parent of Targa Resources, Inc.
(Targa), has entered into Indemnification Agreements
(each, a Targa Investments Indemnification
Agreement) with each director and officer of Targa,
including Messrs. Joyce, Perkins, Heim, McParland, Johnson,
Whalen, Chung, Kagan, Joung and Hwang (each, an
Indemnitee). Each Targa Investments Indemnification
Agreement provides that Targa Investments will indemnify and
hold harmless each Indemnitee for Expenses (as defined in the
Targa Investments Indemnification Agreement) to the fullest
extent permitted or authorized by law in effect on the date of
the agreement or as it may be amended to provide more
advantageous rights to the Indemnitee. If such indemnification
is unavailable as a result of a court decision and if Targa
Investments and the Indemnitee are jointly liable in the
proceeding, Targa Investments will contribute funds to the
Indemnitee for his Expenses in proportion to relative benefit
and fault of Targa Investments and Indemnitee in the transaction
giving rise to the proceeding.
Each Targa Investments Indemnification Agreement also provides
that Targa Investments will indemnify the Indemnitee for
monetary damages for actions taken as a director or officer of
Targa Investments, or for serving at Targa Investments
request as a director or officer or another position at another
corporation or enterprise, as the case may be but only if
(i) the Indemnitee acted in good faith and, in the case of
conduct in his official capacity, in a manner he reasonably
believed to be in the best interests of Targa Investments and,
in all other cases, not opposed to the best interests of Targa
Investments and (ii) in the case of a criminal proceeding,
the Indemnitee must have had no reasonable cause to believe that
his conduct was unlawful. The Targa Investments Indemnification
Agreement also provides that Targa Investments must advance
payment of certain Expenses to the Indemnitee, including fees of
counsel, subject to receipt of an undertaking from the
II-2
Indemnitee to return such advance if it is it is ultimately
determined that the Indemnitee is not entitled to
indemnification.
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Item 16.
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Exhibits
and Financial Statement Schedules
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(a) Exhibits
The following documents are filed as exhibits to this
registration:
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1
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.1**
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Form of Underwriting Agreement
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4
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.1
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Certificate of Limited Partnership of Targa Resources Partners
LP (incorporated by reference to Exhibit 3.2 to Targa Resources
Partners LPs Registration Statement on Form S-1 filed
November 16, 2006 (File No. 333-138747))
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4
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.2
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Certificate of Formation of Targa Resources GP LLC (incorporated
by reference to Exhibit 3.3 to Targa Resources Partners
LPs Registration Statement on Form S-1 filed January 19,
2007 (File No. 333-138747))
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4
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.3
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Agreement of Limited Partnership of Targa Resources Partners LP
(incorporated by reference to Exhibit 3.3 to Targa Resources
Partners LPs Annual Report on Form 10-K filed April 2,
2007 (File No. 001-33303))
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4
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.4
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First Amended and Restated Agreement of Limited Partnership of
Targa Resources Partners LP (incorporated by reference to
Exhibit 3.1 to Targa Resources Partners LPs current report
on Form 8-K filed February 16, 2007 (File No. 001-33303))
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4
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.5
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Amendment No. 1 to First Amended and Restated Agreement of
Limited Partnership of Targa Resources Partners LP (incorporated
by reference to Exhibit 3.5 to Targa Resources Partners
LPs Quarterly Report on Form 10-Q filed May 14, 2008 (File
No. 001-33303))
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4
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.6
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Limited Liability Company Agreement of Targa Resources GP LLC
(incorporated by reference to Exhibit 3.4 to Targa Resources
Partners LPs Registration Statement on Form S-1 filed
January 19, 2007 (File No. 333-138747))
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4
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.7
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Specimen Unit Certificate representing common units
(incorporated by reference to Exhibit 4.1 to Targa Resources
Partners LPs Annual Report on Form 10-K filed April 2,
2007 (File No. 001-33303))
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4
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.8*
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Certificate of Incorporation of Targa Resources Partners Finance
Corporation
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4
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.9*
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Bylaws of Targa Resources Partners Finance Corporation
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4
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.10*
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Form of Senior Indenture
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4
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.11*
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Form of Subordinated Indenture
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4
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.12**
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Form of Debt Securities
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5
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.1*
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Opinion of Vinson & Elkins L.L.P. as to the legality of the
securities registered hereby
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8
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.1*
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Opinion of Vinson & Elkins L.L.P. as to tax matters
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12
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.1*
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Statement Regarding Computation of Ratios
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23
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.1*
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Consent of PricewaterhouseCoopers LLP
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23
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.2
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Consent of Vinson & Elkins L.L.P. (contained in Exhibits
5.1 and 8.1)
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24
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.1
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Powers of Attorney (included on the signature pages of this
registration statement)
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25
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.1**
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Form T-1 Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939 of the Trustee under the Senior
Indenture
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25
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.2**
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Form T-1 Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939 of the Trustee under the
Subordinated Indenture
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* |
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Filed herewith. |
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** |
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To be filed as an exhibit to a report pursuant to
Section 13(a) or 15(d) of the Exchange Act or in a
post-effective amendment to this registration statement. |
II-3
The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration
statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Securities and Exchange Commission
pursuant to Rule 424(b) if, in the aggregate, the changes
in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the
Calculation of Registration Fee table in the
effective registration statement; and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
provided, however, that paragraphs (a)(1)(i), (a)(1)(ii) and
(a)(1)(iii) above do not apply if the registration statement is
on
Form S-3
and the information required to be included in a post-effective
amendment by those paragraphs is contained in reports filed with
or furnished to the Securities and Exchange Commission by the
registrant pursuant to section 13 or section 15(d) of
the Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement, or is contained in a
form of prospectus filed pursuant to Rule 424(b) that is
part of the registration statement.
2. That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
4. That, for the purpose of determining liability under the
Securities Act of 1933 to any purchaser:
(i) Each prospectus filed by the registrant pursuant to
Rule 424(b)(3) shall be deemed to be part of the
registration statement as of the date the filed prospectus was
deemed part of and included in the registration
statement; and
(ii) Each prospectus required to be filed pursuant to
Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration
statement in reliance on Rule 430B relating to an offering
made pursuant to Rule 415(a)(1)(i), (vii), or (x) for
the purpose of providing the information required by
section 10(a) of the Securities Act of 1933 shall be deemed
to be part of and included in the registration statement as of
the earlier of the date such form of prospectus is first used
after effectiveness or the date of the first contract of sale of
securities in the offering described in the prospectus. As
provided in Rule 430B, for liability purposes of the issuer
and any person that is at that date an underwriter, such date
shall be deemed to be a new effective date of the registration
statement relating to the securities in the registration
statement to which that prospectus relates, and the offering of
such securities at that time shall be deemed to be the initial
bona fide offering thereof. Provided, however, that no statement
made in a registration statement or prospectus that is part of
the registration statement or made in a document incorporated or
deemed incorporated by reference into the registration statement
or prospectus that is part of the registration statement will,
as to a purchaser
II-4
with a time of contract of sale prior to such effective date,
supersede or modify any statement that was made in the
registration statement or prospectus that was part of the
registration statement or made in any such document immediately
prior to such effective date.
5. That, for the purpose of determining liability of the
registrant under the Securities Act of 1933 to any purchaser in
the initial distribution of the securities, the undersigned
registrant undertakes that in a primary offering of securities
of the undersigned registrant pursuant to this registration
statement, regardless of the underwriting method used to sell
the securities to the purchaser, if the securities are offered
or sold to such purchaser by means of any of the following
communications, the undersigned registrant will be a seller to
the purchaser and will be considered to offer or sell such
securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the
undersigned registrant relating to the offering required to be
filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering
prepared by or on behalf of the undersigned registrant or used
or referred to by the undersigned registrant;
(iii) The portion of any other free writing prospectus
relating to the offering containing material information about
the undersigned registrant or its securities provided by or on
behalf of the undersigned registrant; and
(iv) Any other communication that is an offer in the
offering made by the undersigned registrant to the purchaser.
6. For purposes of determining any liability under the
Securities Act of 1933, each filing of the registrants
annual report pursuant to section 13(a) or
section 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plans
annual report pursuant to section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in
the registration statement shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
7. To file an application for the purpose of determining
the eligibility of the trustee under subsection (a) of
Section 310 of the Trust Indenture Act
(Act) in accordance with the rules and regulations
prescribed by the Securities and Exchange Commission under
Section 305(b)(2) of the Act.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant to
the provisions set forth in response to Item 15, or
otherwise, the registrant has been advised that in the opinion
of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
II-5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds
to believe that it meets all of the requirements for filing on
Form S-3
and has duly caused this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the
City of Houston, in the State of Texas on April 8, 2010.
TARGA RESOURCES PARTNERS LP
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By:
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TARGA RESOURCES GP LLC,
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its General Partner
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By:
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/s/ Jeffrey
J. McParland
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Name: Jeffrey J. McParland
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Title:
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Executive Vice President and Chief Financial Officer (Principal
Financial Officer)
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KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below hereby constitutes and appoints Rene R.
Joyce and Jeffrey J. McParland, and each of them, with full
power to act without the other, his true and lawful
attorneys-in-fact and agents, with full power of substitution
and resubstitution, for him and in his name, place and stead, in
any and all capacities (until revoked in writing) to sign any
and all amendments (including post-effective amendments) to the
Registration Statement and any additional registration statement
pursuant to Rule 462(b) of the Securities Act, and to file
the same, together with all exhibits thereto and all other
documents in connection therewith, with the Commission, and any
national exchange or self regulatory agency, to sign any and all
applications, registration statements, notices and other
documents necessary or advisable to comply with applicable state
securities laws, and to file the same, together with all other
documents in connection therewith, with the appropriate state
securities authorities, granting unto said attorneys-in-fact and
agents, or any of them or their or his substitutes or
substitute, full power and authority to do and perform each and
every act and thing requisite and necessary to be done, as fully
to all intents and purposes as such director or officer might or
could do and perform in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents, or any of them or
their or his substitutes or substitute, may lawfully do or cause
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons
in the capacities indicated on the dates indicated:
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Signature
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Title
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Date
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/s/ Rene
R. Joyce
Rene
R. Joyce
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Chief Executive Officer and Director
(Principal Executive Officer)
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April 8, 2010
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/s/ Jeffrey
J. McParland
Jeffrey
J. McParland
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Executive Vice President and Chief
Financial Officer
(Principal Financial Officer)
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April 8, 2010
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/s/ John
Robert Sparger
John
Robert Sparger
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Senior Vice President and Chief
Accounting Officer
(Principal Accounting Officer)
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April 8, 2010
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II-6
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Signature
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Title
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Date
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/s/ James
W. Whalen
James
W. Whalen
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Director
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April 8, 2010
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/s/ Peter
R. Kagan
Peter
R. Kagan
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Director
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April 8, 2010
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/s/ Chansoo
Joung
Chansoo
Joung
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Director
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April 8, 2010
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/s/ Barry
R. Pearl
Barry
R. Pearl
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Director
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April 8, 2010
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/s/ Robert
B. Evans
Robert
B. Evans
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Director
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April 6, 2010
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/s/ William
D. Sullivan
William
D. Sullivan
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Director
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April 8, 2010
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II-7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds
to believe that it meets all of the requirements for filing on
Form S-3
and has duly caused this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the
City of Houston, in the State of Texas on April 8, 2010.
TARGA RESOURCES PARTNERS FINANCE
CORPORATION
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By:
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/s/ Jeffrey
J. McParland
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Name: Jeffrey J. McParland
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Title:
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Executive Vice President and Chief Financial Officer (Principal
Financial Officer)
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KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below hereby constitutes and appoints Rene R.
Joyce and Jeffrey J. McParland, and each of them, with full
power to act without the other, his true and lawful
attorneys-in-fact and agents, with full power of substitution
and resubstitution, for him and in his name, place and stead, in
any and all capacities (until revoked in writing) to sign any
and all amendments (including post-effective amendments) to the
Registration Statement and any additional registration statement
pursuant to Rule 462(b) of the Securities Act, and to file
the same, together with all exhibits thereto and all other
documents in connection therewith, with the Commission, and any
national exchange or self regulatory agency, to sign any and all
applications, registration statements, notices and other
documents necessary or advisable to comply with applicable state
securities laws, and to file the same, together with all other
documents in connection therewith, with the appropriate state
securities authorities, granting unto said attorneys-in-fact and
agents, or any of them or their or his substitutes or
substitute, full power and authority to do and perform each and
every act and thing requisite and necessary to be done, as fully
to all intents and purposes as such director or officer might or
could do and perform in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents, or any of them or
their or his substitutes or substitute, may lawfully do or cause
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons
in the capacities indicated on the dates indicated:
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Signature
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Title
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Date
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/s/ Rene
R. Joyce
Rene
R. Joyce
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Chief Executive Officer and Director
(Principal Executive Officer)
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April 8, 2010
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/s/ Jeffrey
J. McParland
Jeffrey
J. McParland
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Executive Vice President and Chief
Financial Officer
(Principal Financial Officer)
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April 8, 2010
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/s/ John
Robert Sparger
John
Robert Sparger
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Senior Vice President and Chief
Accounting Officer
(Principal Accounting Officer)
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April 8, 2010
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II-8
INDEX TO
EXHIBITS
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1
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.1**
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Form of Underwriting Agreement
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4
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.1
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Certificate of Limited Partnership of Targa Resources Partners
LP (incorporated by reference to Exhibit 3.2 to Targa Resources
Partners LPs Registration Statement on Form S-1 filed
November 16, 2006 (File No. 333-138747))
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4
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.2
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Certificate of Formation of Targa Resources GP LLC (incorporated
by reference to Exhibit 3.3 to Targa Resources Partners
LPs Registration Statement on Form S-1 filed January 19,
2007 (File No. 333-138747))
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4
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.3
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Agreement of Limited Partnership of Targa Resources Partners LP
(incorporated by reference to Exhibit 3.3 to Targa Resources
Partners LPs Annual Report on Form 10-K filed April 2,
2007 (File No. 001-33303))
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4
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.4
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First Amended and Restated Agreement of Limited Partnership of
Targa Resources Partners LP (incorporated by reference to
Exhibit 3.1 to Targa Resources Partners LPs current report
on Form 8-K filed February 16, 2007 (File No. 001-33303))
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4
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.5
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Amendment No. 1 to First Amended and Restated Agreement of
Limited Partnership of Targa Resources Partners LP (incorporated
by reference to Exhibit 3.5 to Targa Resources Partners
LPs Quarterly Report on Form 10-Q filed May 14, 2008 (File
No. 001-33303))
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4
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.6
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Limited Liability Company Agreement of Targa Resources GP LLC
(incorporated by reference to Exhibit 3.4 to Targa Resources
Partners LPs Registration Statement on Form S-1 filed
January 19, 2007 (File No. 333-138747))
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4
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.7
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Specimen Unit Certificate representing common units
(incorporated by reference to Exhibit 4.1 to Targa Resources
Partners LPs Annual Report on Form 10-K filed April 2,
2007 (File No. 001-33303))
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4
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.8*
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Certificate of Incorporation of Targa Resources Partners Finance
Corporation
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4
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.9*
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Bylaws of Targa Resources Partners Finance Corporation
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4
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.10*
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Form of Senior Indenture
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4
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.11*
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Form of Subordinated Indenture
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4
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.12**
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Form of Debt Securities
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5
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.1*
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Opinion of Vinson & Elkins L.L.P. as to the legality of the
securities registered hereby
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8
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.1*
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Opinion of Vinson & Elkins L.L.P. as to tax matters
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12
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.1*
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Statement Regarding Computation of Ratios
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23
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.1*
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Consent of PricewaterhouseCoopers LLP
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23
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.2
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Consent of Vinson & Elkins L.L.P. (contained in Exhibits
5.1 and 8.1)
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24
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.1
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Powers of Attorney (included on the signature pages of this
registration statement)
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25
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.1**
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Form T-1 Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939 of the Trustee under the Senior
Indenture
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25
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.2**
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Form T-1 Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939 of the Trustee under the
Subordinated Indenture
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* |
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Filed herewith. |
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** |
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To be filed as an exhibit to a report pursuant to
Section 13(a) or 15(d) of the Exchange Act or in a
post-effective amendment to this registration statement. |
exv4w8
Exhibit 4.8
CERTIFICATE OF INCORPORATION
OF
TARGA RESOURCES PARTNERS FINANCE CORPORATION
FIRST: The name of the corporation is Targa Resources Partners Finance Corporation.
SECOND: The address of its registered office in the State of Delaware is Corporation Trust
Center, 1209 Orange Street, Wilmington, County of New Castle, Delaware 19801. The name of its
registered agent at such address is The Corporation Trust Company.
THIRD: The nature of the business or purposes to be conducted or promoted is to engage in any
lawful act or activity for which corporations may be organized under the General Corporation Law of
Delaware.
FOURTH: The total number of shares of all classes of stock which the corporation shall have
authority to issue is one thousand (1,000) shares of common stock of the par value of $0.01 per
share.
FIFTH: The name of the incorporator is Rene R. Joyce and his mailing address is 1000
Louisiana, Suite 4300, Houston, Texas 77002.
SIXTH: The name and mailing address of the directors, who shall serve until the first annual
meeting of stockholders or until their successors are elected and qualified, are as follows:
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Name |
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Address |
Rene R. Joyce
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1000 Louisiana, Suite 4300 |
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Houston, Texas 77002 |
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Jeffrey J. McParland
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1000 Louisiana, Suite 4300 |
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Houston, Texas 77002 |
The number of directors of the corporation shall be as specified in, or determined in the manner
provided in, the bylaws. Election of directors need not be by written ballot.
SEVENTH: In furtherance of, and not in limitation of, the powers conferred by statute, the
Board of Directors is expressly authorized to adopt, amend or repeal the bylaws of the corporation.
EIGHTH: No director of the corporation shall be liable to the corporation or its stockholders
for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any
breach of the directors duty of loyalty to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from
which the director derived an improper personal benefit.
NINTH: The corporation shall have the right, subject to any express provisions or
restrictions contained in the certificate of incorporation or bylaws of the corporation, from time
to time, to amend the certificate of incorporation or any provision thereof in any manner now or
hereafter provided by law, and all rights and powers of any kind conferred upon a director or
stockholder of the corporation by the certificate of incorporation or any amendment thereof are
subject to such right of the corporation.
I, the undersigned, being the incorporator hereinbefore named, for the purpose of forming a
corporation pursuant to the General Corporation Law of the State of Delaware, do make this
certificate, hereby declaring that this is my act and deed and that the facts herein stated are
true, and accordingly have hereunto set my hand this 23rd day of May, 2008.
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/s/ Rene R. Joyce
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Rene R. Joyce
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Incorporator |
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2
exv4w9
Exhibit 4.9
BYLAWS
OF
TARGA RESOURCES PARTNERS FINANCE CORPORATION
A Delaware Corporation
Date of Adoption:
May 23, 2008
TARGA RESOURCES PARTNERS FINANCE CORPORATION
BYLAWS
Table of Contents
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Page |
ARTICLE I
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OFFICES
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Section 1.01 Registered Office |
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1 |
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Section 1.02 Other Offices |
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1 |
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ARTICLE II
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STOCKHOLDERS
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Section 2.01 Place of Meetings |
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1 |
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Section 2.02 Quorum; Adjournment of Meetings |
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1 |
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Section 2.03 Annual Meetings |
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2 |
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Section 2.04 Special Meetings |
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2 |
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Section 2.05 Record Date |
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2 |
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Section 2.06 Notice of Meetings |
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3 |
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Section 2.07 Stock List |
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3 |
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Section 2.08 Proxies |
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3 |
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Section 2.09 Voting; Elections; Inspectors |
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3 |
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Section 2.10 Order of Business |
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4 |
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Section 2.11 Treasury Stock |
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4 |
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Section 2.12 Action Without Meeting |
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4 |
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ARTICLE III
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BOARD OF DIRECTORS
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Section 3.01 Power; Number; Term of Office |
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5 |
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Section 3.02 Quorum |
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5 |
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Section 3.03 Place of Meetings; Order of Business |
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5 |
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Section 3.04 First Meeting |
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5 |
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Section 3.05 Regular Meetings |
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5 |
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Section 3.06 Special Meetings |
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5 |
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Section 3.07 Removal |
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6 |
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Section 3.08 Vacancies; Increases in the Number of Directors |
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6 |
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Section 3.09 Compensation |
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6 |
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Section 3.10 Action Without a Meeting; Telephone Conference Meeting |
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6 |
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Section 3.11 Approval or Ratification of Acts or Contracts by Stockholders |
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7 |
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Page |
ARTICLE IV
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COMMITTEES
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Section 4.01 Designation; Powers |
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7 |
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Section 4.02 Procedure; Meetings; Quorum |
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7 |
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Section 4.03 Substitution of Members |
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8 |
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ARTICLE V
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OFFICERS
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Section 5.01 Number, Titles and Term of Office |
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8 |
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Section 5.02 Salaries |
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8 |
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Section 5.03 Removal |
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8 |
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Section 5.04 Vacancies |
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8 |
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Section 5.05 Powers and Duties of the Chief Executive Officer |
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8 |
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Section 5.06 Powers and Duties of the Chairman of the Board |
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9 |
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Section 5.07 Powers and Duties of the President |
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9 |
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Section 5.08 Vice Presidents |
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9 |
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Section 5.09 Treasurer |
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9 |
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Section 5.10 Assistant Treasurers |
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9 |
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Section 5.11 Secretary |
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9 |
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Section 5.12 Assistant Secretaries |
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10 |
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Section 5.13 Action with Respect to Securities of Other Corporations |
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10 |
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ARTICLE VI
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INDEMNIFICATION OF DIRECTORS,
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OFFICERS, EMPLOYEES AND AGENTS
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Section 6.01 Right to Indemnification |
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10 |
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Section 6.02 Indemnification of Employees and Agents |
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11 |
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Section 6.03 Right of Claimant to Bring Suit |
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11 |
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Section 6.04 Nonexclusivity of Rights |
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11 |
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Section 6.05 Insurance |
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11 |
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Section 6.06 Savings Clause |
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12 |
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Section 6.07 Definitions |
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12 |
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ARTICLE VII
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CAPITAL STOCK
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Section 7.01 Certificates of Stock |
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12 |
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Section 7.02 Transfer of Shares |
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13 |
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Section 7.03 Ownership of Shares |
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13 |
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Section 7.04 Regulations Regarding Certificates |
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13 |
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Section 7.05 Lost or Destroyed Certificates |
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13 |
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ARTICLE VIII
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MISCELLANEOUS PROVISIONS
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Section 8.01 Fiscal Year |
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13 |
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Section 8.02 Notice and Waiver of Notice |
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13 |
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ii
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Page |
Section 8.03 Resignations |
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14 |
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Section 8.04 Facsimile Signatures |
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14 |
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Section 8.05 Reliance upon Books, Reports and Records |
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14 |
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ARTICLE IX
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AMENDMENTS
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iii
BYLAWS
OF
TARGA RESOURCES PARTNERS FINANCE CORPORATION
ARTICLE I
OFFICES
Section 1.01 Registered Office. The registered office of the Corporation required by the General Corporation Law of the State of
Delaware to be maintained in the State of Delaware, shall be the registered office named in the
original Certificate of Incorporation of the Corporation, or such other office as may be designated
from time to time by the Board of Directors in the manner provided by law. Should the Corporation
maintain a principal office within the State of Delaware such registered office need not be
identical to such principal office of the Corporation.
Section 1.02 Other Offices. The Corporation may also have offices at such other places both within and without the State of
Delaware as the Board of Directors may from time to time determine or the business of the
Corporation may require.
ARTICLE II
STOCKHOLDERS
Section 2.01 Place of Meetings. All meetings of the stockholders shall be held at the principal office of the Corporation, or at
such other place within or without the State of Delaware as shall be specified or fixed in the
notices or waivers of notice thereof.
Section 2.02 Quorum; Adjournment of Meetings. Unless otherwise required by law or provided in the Certificate of Incorporation or these
bylaws, the holders of a majority of the stock issued and outstanding and entitled to vote thereat,
present in person or represented by proxy, shall constitute a quorum at any meeting of stockholders
for the transaction of business and the act of a majority of such stock so represented at any
meeting of stockholders at which a quorum is present shall constitute the act of the meeting of
stockholders. The stockholders present at a duly organized meeting may continue to transact
business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less
than a quorum.
Notwithstanding the other provisions of the Certificate of Incorporation or these bylaws, the
chairman of the meeting or the holders of a majority of the issued and outstanding stock, present
in person or represented by proxy, at any meeting of stockholders, whether or not a quorum is
present, shall have the power to adjourn such meeting from time to time, without any notice other
than announcement at the meeting of the time and place of the holding of the adjourned meeting. If
the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is
fixed for the adjourned meeting, a notice of the adjourned
meeting shall be given to each
stockholder of record entitled to vote at such meeting. At such adjourned meeting at which a
quorum shall be present or represented any business may be transacted which might have been
transacted at the meeting as originally called.
Section 2.03 Annual Meetings. An annual meeting of the stockholders, for the election of directors to succeed those whose
terms expire and for the transaction of such other business as may properly come before the
meeting, shall be held at such place, within or without the State of Delaware, on such date, and at
such time as the Board of Directors shall fix and set forth in the notice of the meeting, which
date shall be within thirteen (13) months subsequent to the later of the date of incorporation or
the last annual meeting of stockholders.
Section 2.04 Special Meetings. Unless otherwise provided in the Certificate of Incorporation, special meetings of the
stockholders for any purpose or purposes may be called at any time by the Chairman of the Board (if
any), by the President or by a majority of the Board of Directors, or by a majority of the
executive committee (if any), and shall be called by the Chairman of the Board (if any), by the
President or the Secretary upon the written request therefore, stating the purpose or purposes of
the meeting, delivered to such officer, signed by the holder(s) of at least ten percent (l0%) of
the issued and outstanding stock entitled to vote at such meeting.
Section 2.05 Record Date. For the purpose of determining stockholders entitled to notice of or to vote at any meeting of
stockholders, or any adjournment thereof, or entitled to express consent to corporate action in
writing without a meeting, or entitled to receive payment of any dividend or other distribution or
allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or
exchange of stock or for the purpose of any other lawful action, the Board of Directors of the
Corporation may fix, in advance, a date as the record date for any such determination of
stockholders, which date shall not be more than sixty (60) days nor less than ten (l0) days before
the date of such meeting, nor more than sixty (60) days prior to any other action.
If the Board of Directors does not fix a record date for any meeting of the stockholders, the
record date for determining stockholders entitled to notice of or to vote at such meeting shall be
at the close of business on the day next preceding the day on which notice is given, or, if in
accordance with Article VIII, Section 3 of these bylaws notice is waived, at the close of business
on the day next preceding the day on which the meeting is held. If, in accordance with Section 12
of this Article II, corporate action without a meeting of stockholders is to be taken, the record
date for determining stockholders entitled to express consent to such corporate action in
writing, when no prior action by the Board of Directors is necessary, shall be the day on which the
first written consent is expressed. The record date for determining stockholders for any other
purpose shall be at the close of business on the day on which the Board of Directors adopts the
resolution relating thereto.
A determination of stockholders of record entitled to notice of or to vote at a meeting of
stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of
Directors may fix a new record date for the adjourned meeting.
- 2 -
Section 2.06 Notice of Meetings. Written notice of the place, date and hour of all meetings, and, in case of a special meeting,
the purpose or purposes for which the meeting is called, shall be given by or at the direction of
the Chairman of the Board (if any) or the President, the Secretary or the other person(s) calling
the meeting to each stockholder entitled to vote thereat not less than ten (10) nor more than sixty
(60) days before the date of the meeting. Such notice may be delivered personally by mail or by
electronic transmission in the manner provided in Section 232 of the Delaware General Corporation
Law. If mailed, notice is given when deposited in the United States mail, postage prepaid,
directed to the stockholder at his address as it appears on the records of the Corporation.
Section 2.07 Stock List. A complete list of stockholders entitled to vote at any meeting of stockholders, arranged in
alphabetical order for each class of stock and showing the address of each such stockholder and the
number of shares registered in the name of such stockholder, shall be open to the examination of
any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a
period of at least ten (10) days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the meeting, or if not so
specified, at the place where the meeting is to be held. The stock list shall also be produced and
kept at the time and place of the meeting during the whole time thereof, and may be inspected by
any stockholder who is present.
Section 2.08 Proxies. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent
to a corporate action in writing without a meeting may authorize another person or persons to act
for him by proxy. Proxies for use at any meeting of stockholders shall be filed with the
Secretary, or such other officer as the Board of Directors may from time to time determine by
resolution, before or at the time of the meeting. All proxies shall be received and taken charge
of and all ballots shall be received and canvassed by the secretary of the meeting who shall decide
all questions touching upon the qualification of voters, the validity of the proxies, and the
acceptance or rejection of votes, unless an inspector or inspectors shall have been appointed by
the chairman of the meeting, in which event such inspector or inspectors shall decide all such
questions.
No proxy shall be valid after three (3) years from its date, unless the proxy provides for a
longer period. Each proxy shall be revocable unless expressly provided therein to be irrevocable
and coupled with an interest sufficient in law to support an irrevocable power.
Should a proxy designate two or more persons to act as proxies, unless such instrument shall
provide the contrary, a majority of such persons present at any meeting at which their powers
thereunder are to be exercised shall have and may exercise all the powers of voting or giving
consents thereby conferred, or if only one be present, then such powers may be exercised by that
one; or, if an even number attend and a majority do not agree on any particular issue, each proxy
so attending shall be entitled to exercise such powers in respect of the same portion of the shares
as he is of the proxies representing such shares.
Section 2.09 Voting; Elections; Inspectors. Unless otherwise required by law or provided in the Certificate of Incorporation, each
stockholder shall have one vote for each share of stock entitled to vote which is registered in his
name on the record date for the meeting. Shares registered in the name of another corporation,
domestic or foreign, may be voted by such
- 3 -
officer, agent or proxy as the bylaw (or comparable
instrument) of such corporation may prescribe, or in the absence of such provision, as the Board of
Directors (or comparable body) of such corporation may determine. Shares registered in the name of
a deceased person may be voted by his executor or administrator, either in person or by proxy.
All voting, except as required by the Certificate of Incorporation or where otherwise required
by law, may be by a voice vote; provided, however, that upon demand therefor by stockholders
holding a majority of the issued and outstanding stock present in person or by proxy at any meeting
a stock vote shall be taken. Every stock vote shall be taken by written ballots, each of which
shall state the name of the stockholder or proxy voting and such other information as may be
required under the procedure established for the meeting. All elections of directors shall be by
ballot, unless otherwise provided in the Certificate of Incorporation.
At any meeting at which a vote is taken by ballots, the chairman of the meeting may appoint
one or more inspectors, each of whom shall subscribe an oath or affirmation to execute faithfully
the duties of inspector at such meeting with strict impartiality and according to the best of his
ability. Such inspector shall receive the ballots, count the votes and make and sign a certificate
of the result thereof. The chairman of the meeting may appoint any person to serve as inspector,
except no candidate for the office of director shall be appointed as an inspector.
Unless otherwise provided in the Certificate of Incorporation, cumulative voting for the
election of directors shall be prohibited.
Section 2.10 Order of Business. At each meeting of the stockholders, one of the following persons, in the order in which they
are listed (and in the absence of the first, the next, and so on), shall serve as chairman of the
meeting: president, chairman of the board, vice presidents (in the order of their seniority if more
than one), and secretary. The order of business at each such meeting shall be as determined by the
chairman of the meeting. The chairman of the meeting shall have the right and authority to
prescribe such rules, regulations, and procedures and to do all such acts and things as are
necessary or desirable for the proper conduct of the meeting, including, without limitation, the
establishment of procedures for the maintenance of order and safety, limitations on the time
allotted to questions or comments on the affairs of the corporation, restrictions on entry to such
meeting after the time prescribed for the commencement thereof, and the opening and closing of the
voting polls.
Section 2.11 Treasury Stock. The Corporation shall not vote, directly or indirectly, shares of its own stock owned by it and
such shares shall not be counted for quorum purposes.
Section 2.12 Action Without Meeting. Unless otherwise provided in the Certificate of Incorporation, any action permitted or required
by law, the Certificate of Incorporation or these bylaws to be taken at a meeting of stockholders,
may be taken without a meeting, without prior notice and without a vote, if a consent in writing,
setting forth the action so taken, shall be signed by the holders of outstanding stock having not
less than the minimum number of votes that would be necessary to authorize or take such action at a
meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the
taking of the corporate action without a meeting by less than a unanimous written consent shall be
given by the Secretary to those stockholders who have not consented in writing.
- 4 -
ARTICLE III
BOARD OF DIRECTORS
Section 3.01 Power; Number; Term of Office. The business and affairs of the Corporation shall be managed by or under the direction of the
Board of Directors, and subject to the restrictions imposed by law or the Certificate of
Incorporation, they may exercise all the powers of the Corporation.
The number of directors which shall constitute the whole Board of Directors, shall be
determined from time to time by resolution of the Board of Directors (provided that no decrease in
the number of directors which would have the effect of shortening the term of an incumbent director
may be made by the Board of Directors). If the Board of Directors makes no such determination, the
number of directors shall be the number set forth in the Certificate of Incorporation. Each
director shall hold office for the term for which he is elected, and until his successor shall have
been elected and qualified or until his earlier death, resignation or removal.
Unless otherwise provided in the Certificate of Incorporation, directors need not be
stockholders nor residents of the State of Delaware.
Section 3.02 Quorum. Unless otherwise provided in the Certificate of Incorporation, a majority of the total number of
directors shall constitute a quorum for the transaction of business of the Board of Directors and
the vote of a majority of the directors present at a meeting at which a quorum is present shall be
the act of the Board of Directors.
Section 3.03 Place of Meetings; Order of Business. The directors may hold their meetings and may have an office and keep the books of the
Corporation, except as otherwise provided by law, in such place or places, within or without the
State of Delaware, as the Board of Directors may from time to time determine by resolution. At all
meetings of the Board of Directors business shall be transacted in such order as shall from time to
time be determined by the Chairman of the Board (if any), or in his absence by the President, or by
resolution of the Board of Directors.
Section 3.04 First Meeting. Each newly elected Board of Directors may hold its first meeting for the purpose of organization
and the transaction of business, if a quorum is present, immediately after and at the same place as
the annual meeting of the stockholders. Notice of such meeting shall not be required. At the
first meeting of the Board of Directors in each year at which a quorum shall be present, held next
after the annual meeting of stockholders, the Board of Directors shall proceed to the election of
the officers of the Corporation.
Section 3.05 Regular Meetings. Regular meetings of the Board of Directors shall be held at such times and places as shall be
designated from time to time by resolution of the Board of Directors. Notice of such regular
meetings shall not be required.
Section 3.06 Special Meetings. Special meetings of the Board of Directors may be called by the Chairman of the Board (if any),
the President or, on the written request of any two directors, by the Secretary, in each case on at
least twenty-four (24) hours personal, written, telegraphic, cable, telephonic or e-mail notice to
each director. Such notice, or any waiver
- 5 -
thereof pursuant to Article VIII, Section 3 hereof,
need not state the purpose or purposes of such meeting, except as may otherwise be required by law
or provided for in the Certificate of Incorporation or these bylaws.
Section 3.07 Removal. Any director or the entire Board of Directors may be removed, with or without cause, by the
holders of a majority of the shares then entitled to vote at an election of directors; provided
that, unless the Certificate of Incorporation otherwise provides, if the Board of Directors is
classified, then the stockholders may effect such removal only for cause; and provided further
that, if the Certificate of Incorporation expressly grants to stockholders the right to cumulate
votes for the election of directors and if less than the entire board is to be removed, no director
may be removed without cause if the votes cast against his removal would be sufficient to elect him
if then cumulatively voted at an election of the entire Board of Directors, or, if there be classes
of directors, at an election of the class of directors of which such director is a part.
Section 3.08 Vacancies; Increases in the Number of Directors. Unless otherwise provided in the Certificate of Incorporation, vacancies and newly created
directorships resulting from any increase in the authorized number of directors may be filled by a
majority of the directors then in office, although less than a quorum, or a sole remaining
director; and any director so chosen shall hold office until the next annual election and until his
successor shall be duly elected and shall qualify, unless sooner displaced.
If the directors of the Corporation are divided into classes, any directors elected to fill
vacancies or newly created directorships shall hold office until the next election of the class for
which such directors shall have been chosen, and until their successors shall be duly elected and
shall qualify.
Section 3.09 Compensation. Unless otherwise restricted by the Certificate of Incorporation, the Board of Directors shall
have the authority to fix the compensation of directors.
Section 3.10 Action Without a Meeting; Telephone Conference Meeting. Unless otherwise restricted by the Certificate of Incorporation, any action required or
permitted to be taken at any meeting of the Board of Directors, or any committee designated by the
Board of Directors, may be taken without a meeting if all members of the Board of Directors or
committee, as the case may be consent thereto in writing or by electronic transmission, and the
writing or writings or electronic transmission or transmissions are filed with the minutes of
proceedings of the Board of Directors or committee. Such consent shall have the same force and
effect as a unanimous vote at a meeting, and may be stated as such in any document or instrument
filed with the Secretary of State of Delaware.
Unless otherwise restricted by the Certificate of Incorporation, subject to the requirement
for notice of meetings, members of the Board of Directors, or members of any committee designated
by the Board of Directors, may participate in a meeting of such Board of Directors or committee, as
the case may be, by means of a conference telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each other, and participation in such a
meeting shall constitute presence in person at such meeting, except where
- 6 -
a person participates in
the meeting for the express purpose of objecting to the transaction of any business on the ground
that the meeting is not lawfully called or convened.
Section 3.11 Approval or Ratification of Acts or Contracts by Stockholders. The Board of Directors in its discretion may submit any act or contract for approval or
ratification at any annual meeting of the stockholders, or at any special meeting of the
stockholders called for the purpose of considering any such act or contract, and any act or
contract that shall be approved or be ratified by the vote of the stockholders holding a majority
of the issued and outstanding shares of stock of the Corporation entitled to vote and present in
person or by proxy at such meeting (provided that a quorum is present), shall be as valid and as
binding upon the Corporation and upon all the stockholders as if it has been approved or ratified
by every stockholder of the Corporation. In addition, any such act or contract may be approved or
ratified by the written consent of stockholders holding a majority of the issued and outstanding
shares of capital stock of the Corporation entitled to vote and such consent shall be as valid and
as binding upon the Corporation and upon all the stockholders as if it had been approved or
ratified by every stockholder of the Corporation.
ARTICLE IV
COMMITTEES
Section 4.01 Designation; Powers. The Board of Directors may, by resolution passed by a majority of the whole board, designate one
or more committees, including, if they shall so determine, an executive committee, each such
committee to consist of one or more of the directors of the Corporation. Any such designated
committee shall have and may exercise such of the powers and authority of the Board of Directors in
the management of the business and affairs of the Corporation as may be provided in such
resolution, except that no such committee shall have the power or authority of the Board of
Directors in reference to amending the Certificate of Incorporation, adopting an agreement of
merger or consolidation, recommending to the stockholders the sale, lease or exchange of all or
substantially all of the Corporations property and assets, recommending to the stockholders a
dissolution of the Corporation or a revocation of a dissolution of the Corporation, or amending,
altering or repealing the bylaws or adopting new bylaws for the Corporation and, unless such
resolution or the Certificate of Incorporation expressly so provides, no such committee shall have
the power or authority to declare a dividend or to authorize the issuance of stock. Any such
designated committee may authorize the seal of the Corporation to be affixed to all papers which
may require it. In addition to the above such committee or committees shall have such other powers
and limitations of authority as may be determined from time to time by resolution adopted by the
Board of Directors.
Section 4.02 Procedure; Meetings; Quorum. Any committee designated pursuant to Section 1 of this Article shall choose its own chairman,
shall keep regular minutes of its proceedings and report the same to the Board of Directors when
requested, shall fix its own rules or procedures, and shall meet at such times and at such place or
places as may be provided by such rules, or by resolution of such committee or resolution of the
Board of Directors. At every meeting of any such committee, the presence of a majority of all the
members thereof shall
- 7 -
constitute a quorum and the affirmative vote of a majority of the members
present shall be necessary for the adoption by it of any resolution.
Section 4.03 Substitution of Members. The Board of Directors may designate one or more directors as alternate members of any
committee, who may replace any absent or disqualified member at any meeting of such committee. In
the absence or disqualification of a member of a committee, the member or members present at any
meeting and not disqualified from voting, whether or not constituting a quorum, may unanimously
appoint another member of the Board of Directors to act at the meeting in the place of the absent
or disqualified member.
ARTICLE V
OFFICERS
Section 5.01 Number, Titles and Term of Office. The officers of the Corporation shall be a Chief Executive Officer, a President, one or more
Vice Presidents (any one or more of whom may be designated Executive Vice President or Senior Vice
President), a Treasurer, a Secretary and, if the Board of Directors so elects, a Chairman of the
Board and such other officers as the Board of Directors may from time to time elect or appoint.
Each officer shall hold office until his successor shall be duly elected and shall qualify or until
his death or until he shall resign or shall have been removed in the manner hereinafter provided.
Any number of offices may be held by the same person, unless the Certificate of Incorporation
provides otherwise. Except for the Chairman of the Board, if any, no officer need be a director.
Section 5.02 Salaries. The salaries or other compensation of the officers and agents of the Corporation shall be fixed
from time to time by the Board of Directors.
Section 5.03 Removal. Any officer or agent elected or appointed by the Board of Directors may be removed, either with
or without cause, by the vote of a majority of the whole Board of Directors at a special meeting
called for the purpose, or at any regular meeting of the Board of Directors, provided the notice
for such meeting shall specify that the matter of any such proposed removal will be considered at
the meeting but such removal shall be without prejudice to the contract rights, if any, of the
person so removed. Election or appointment of an officer or agent shall not of itself create
contract rights.
Section 5.04 Vacancies. Any vacancy occurring in any office of the Corporation may be filled by the Board of Directors.
Section 5.05 Powers and Duties of the Chief Executive Officer. The President shall be the chief executive officer of the Corporation unless the Board of
Directors designates the Chairman of the Board as chief executive officer. Subject to the control
of the Board of Directors and the executive committee (if any), the chief executive officer shall
have general executive charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such responsibilities; he may
agree upon and execute all leases, contracts, evidences of indebtedness and other obligations in
the name of the Corporation and may sign all certificates for shares of capital stock of the
- 8 -
Corporation; and shall have such other powers and duties as designated in accordance with these
bylaws and as from time to time may be assigned to him by the Board of Directors.
Section 5.06 Powers and Duties of the Chairman of the Board. If elected, the Chairman of the Board shall preside at all meetings of the stockholders and of
the Board of Directors; and he shall have such other powers and duties as designated in these
bylaws and as from time to time may be assigned to him by the Board of Directors.
Section 5.07 Powers and Duties of the President. Unless the Board of Directors otherwise determines, the President shall have the authority to
agree upon and execute all leases, contracts, evidences of indebtedness and other obligations in
the name of the Corporation; and, unless the Board of Directors otherwise determines, he shall, in
the absence of the Chairman of the Board or if there be no Chairman of the Board, preside at all
meetings of the stockholders and (should he be a director) of the Board of Directors; and he shall
have such other powers and duties as designated in accordance with these bylaws and as from time to
time may be assigned to him by the Board of Directors.
Section 5.08 Vice Presidents. In the absence of the President, or in the event of his inability or refusal to act, a Vice
President designated by the Board of Directors shall perform the duties of the President, and when
so acting shall have all the powers of and be subject to all the restrictions upon the President.
In the absence of a designation by the Board of Directors of a Vice President to perform the duties
of
the President, or in the event of his absence or inability or refusal to act, the Vice President
who is present and who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other powers as the Board
of Directors may from time to time prescribe.
Section 5.09 Treasurer. The Treasurer shall have responsibility for the custody and control of all the funds and
securities of the Corporation, and he shall have such other powers and duties as designated in
these bylaws and as from time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control of the chief
executive officer and the Board of Directors; and he shall, if required by the Board of Directors,
give such bond for the faithful discharge of his duties in such form as the Board of Directors may
require.
Section 5.10 Assistant Treasurers. Each Assistant Treasurer shall have the usual powers and duties pertaining to his office,
together with such other powers and duties as designated in these bylaws and as from time to time
may be assigned to him by the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officers absence or inability or
refusal to act.
Section 5.11 Secretary. The Secretary shall keep the minutes of all meetings of the Board of Directors, committees of
directors and the stockholders, in books provided for that purpose; he shall attend to the giving
and serving of all notices; he may in the name of the Corporation affix the seal of the Corporation
to all contracts of the Corporation and attest the affixation of the seal of the Corporation
thereto; he may sign with the other appointed officers all certificates for shares of capital stock
of the Corporation; he shall have charge of the certificate books, transfer books and stock
ledgers, and such other books and papers as the Board of
- 9 -
Directors may direct, all of which shall
at all reasonable times be open to inspection of any director upon application at the office of the
Corporation during business hours; he shall have such other powers and duties as designated in
these bylaws and as from time to time may be assigned to him by the Board of Directors; and he
shall in general perform all acts incident to the office of Secretary, subject to the control of
the chief executive officer and the Board of Directors.
Section 5.12 Assistant Secretaries. Each Assistant Secretary shall have the usual powers and duties pertaining to his office,
together with such other powers and duties as designated in these bylaws and as from time to time
may be assigned to him by the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officers absence or inability
or refusal to act.
Section 5.13 Action with Respect to Securities of Other Corporations. Unless otherwise directed by the Board of Directors, the chief executive officer shall have
power to vote and otherwise act on behalf of the Corporation, in person or by proxy, at any meeting
of security holders of or with respect to any action of security holders of any other corporation
in which this Corporation may hold securities and otherwise to exercise any and all rights and
powers which this Corporation may possess by reason of its ownership of securities in such other
corporation.
ARTICLE VI
INDEMNIFICATION OF DIRECTORS,
OFFICERS, EMPLOYEES AND AGENTS
Section 6.01 Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is involved in
any action, suit or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a proceeding), by reason of the fact that he or she or a person of whom he or she is
the legal representative, is or was or has agreed to become a director or officer of the
Corporation or is or was serving or has agreed to serve at the request of the Corporation as a
director, officer, employee or agent of another corporation or of a partnership, joint venture,
trust or other enterprise, including service with respect to employee benefit plans, whether the
basis of such proceeding is alleged action in an official capacity as a director or officer or in
any other capacity while serving or having agreed to serve as a director or officer, shall be
indemnified and held harmless by the Corporation to the fullest extent authorized by the Delaware
General
Corporation Law, as the same exists or may hereafter be amended, (but, in the case of any such
amendment, only to the extent that such amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation to provide prior to such amendment)
against all expense, liability and loss (including without limitation, attorneys fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by such person in connection therewith and such indemnification shall continue
as to a person who has ceased to serve in the capacity which initially entitled such person to
indemnity hereunder and shall inure to the benefit of his or her heirs, executors and
administrators; provided, however, that the Corporation shall indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated by such person only if
such proceeding (or part thereof) was authorized by the board of directors of the Corporation. The
right to indemnification conferred
- 10 -
in this Article VI shall be a contract right and shall include
the right to be paid by the Corporation the expenses incurred in defending any such proceeding in
advance of its final disposition; provided, however, that, if the Delaware General Corporation Law
requires, the payment of such expenses incurred by a current, former or proposed director or
officer in his or her capacity as a director or officer or proposed director or officer (and not in
any other capacity in which service was or is or has been agreed to be rendered by such person
while a director or officer, including, without limitation, service to an employee benefit plan) in
advance of the final disposition of a proceeding, shall be made only upon delivery to the
Corporation of an undertaking, by or on behalf of such indemnified person, to repay all amounts so
advanced if it shall ultimately be determined that such indemnified person is not entitled to be
indemnified under this Section or otherwise.
Section 6.02 Indemnification of Employees and Agents. The Corporation may, by action of its Board of Directors, provide indemnification to employees
and agents of the Corporation, individually or as a group, with the same scope and effect as the
indemnification of directors and officers provided for in this Article.
Section 6.03 Right of Claimant to Bring Suit. If a written claim received by the Corporation from or on behalf of an indemnified party under
this Article VI is not paid in full by the Corporation within ninety days after such receipt, the
claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount
of the claim and, if successful in whole or in part, the claimant shall be entitled to be paid also
the expense of prosecuting such claim. It shall be a defense to any such action (other than an
action brought to enforce a claim for expenses incurred in defending any proceeding in advance of
its final disposition where the required undertaking, if any is required, has been tendered to the
Corporation) that the claimant has not met the standards of conduct which make it permissible under
the Delaware General Corporation Law for the Corporation to indemnify the claimant for the amount
claimed, but the burden of proving such defense shall be on the Corporation. Neither the failure
of the Corporation (including its Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the commencement of such action that
indemnification of the claimant is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual
determination by the Corporation (including its Board of Directors, independent legal counsel, or
its stockholders) that the claimant has not met such
applicable standard of conduct, shall be a defense to the action or create a presumption that the
claimant has not met the applicable standard of conduct.
Section 6.04 Nonexclusivity of Rights. The right to indemnification and the advancement and payment of expenses conferred in this
Article VI shall not be exclusive of any other right which any person may have or hereafter acquire
under any law (common or statutory), provision of the Certificate of Incorporation of the
Corporation, bylaw, agreement, vote of stockholders or disinterested directors or otherwise.
Section 6.05 Insurance. The Corporation may maintain insurance, at its expense, to protect itself and any person who is
or was serving as a director, officer, employee or agent of the Corporation or is or was serving at
the request of the Corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against any expense, liability or loss,
whether or not the Corporation would have the power to
- 11 -
indemnify such person against such expense,
liability or loss under the Delaware General Corporation Law.
Section 6.06 Savings Clause. If this Article VI or any portion hereof shall be invalidated on any ground by any court of
competent jurisdiction, then the Corporation shall nevertheless indemnify and hold harmless each
director and officer of the Corporation, as to costs, charges and expenses (including
attorneys fees), judgments, fines, and amounts paid in settlement with respect to any action, suit
or proceeding, whether civil, criminal, administrative or investigative to the full extent
permitted by any applicable portion of this Article VI that shall not have been invalidated and to
the fullest extent permitted by applicable law.
Section 6.07 Definitions. For purposes of this Article, reference to the Corporation shall include, in addition to the
Corporation, any constituent corporation (including any constituent of a constituent) absorbed in a
consolidation or merger prior to (or, in the case of an entity specifically designated in a
resolution of the Board of Directors, after) the adoption hereof and which, if its separate
existence had continued, would have had the power and authority to indemnify its directors,
officers and employees or agents, so that any person who is or was a director, officer, employee or
agent of such constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same position under the provisions of this
Article with respect to the resulting or surviving corporation as he would have with respect to
such constituent corporation if its separate existence had continued.
ARTICLE VII
CAPITAL STOCK
Section 7.01 Certificates of Stock. The certificates for shares of the capital stock of the Corporation shall be in such form, not
inconsistent with that required by law and the Certificate of Incorporation, as shall be approved
by the Board of Directors. The Chairman of the Board (if any), President or a Vice President shall
cause to be issued to each stockholder one or more certificates, under the seal of the Corporation
or a facsimile thereof if the Board of Directors shall have provided for such seal, and signed by
the Chairman of the Board (if any), President or a Vice President and the Secretary or an Assistant
Secretary or the Treasurer or an Assistant Treasurer certifying the number of shares (and, if the
stock of the Corporation shall be divided into classes or series, the class and series of such
shares) owned by such stockholder in the Corporation; provided, however, that any of or all the
signatures on the certificate may be facsimile. The stock record books and the blank stock
certificate books shall be kept by the Secretary, or at the office of such transfer agent or
transfer agents as the Board of Directors may from time to time by resolution determine. In case
any officer, transfer agent or registrar who shall have signed or whose facsimile signature or
signatures shall have been placed upon any such certificate or certificates shall have ceased to be
such officer, transfer agent or registrar before such certificate is issued by the Corporation,
such certificate may nevertheless be issued by the Corporation with the same effect as if such
person were such officer, transfer agent or registrar at the date of issue. The stock certificates
shall be consecutively numbered and shall be entered in the books of the Corporation as they are
issued and shall exhibit the holders name and number of shares.
- 12 -
Section 7.02 Transfer of Shares. The shares of stock of the Corporation shall be transferable only on the books of the
Corporation by the holders thereof in person or by their duly authorized attorneys or legal
representatives upon surrender and cancellation of certificates for a like number of shares. Upon
surrender to the Corporation or a transfer agent of the Corporation of a certificate for shares
duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer,
it shall be the duty of the Corporation to issue a new certificate to the person entitled thereto,
cancel the old certificate and record the transaction upon its books.
Section 7.03 Ownership of Shares. The Corporation shall be entitled to treat the holder of record of any share or shares of
capital stock of the Corporation as the holder in fact thereof and, accordingly, shall not be bound
to recognize any equitable or other claim to or interest in such share or shares on the part of any
other person, whether or not it shall have express or other notice thereof, except as otherwise
provided by the laws of the State of Delaware.
Section 7.04 Regulations Regarding Certificates. The Board of Directors shall have the power and authority to make all such rules and regulations
as they may deem expedient concerning the issue, transfer and registration or the replacement of
certificates for shares of capital stock of the Corporation.
Section 7.05 Lost or Destroyed Certificates. The Board of Directors may determine the conditions upon which a new certificate of stock may be
issued in place of a certificate which is alleged to have been lost, stolen or destroyed; and
may, in their discretion, require the owner of such certificate or his legal representative to give
bond, with sufficient surety, to indemnify the Corporation and each transfer agent and registrar
against any and all losses or claims which may arise by reason of the issue of a new certificate in
the place of the one so lost, stolen or destroyed.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01 Fiscal Year. The fiscal year of the Corporation shall be such as established from time to time by the Board
of Directors.
Section 8.02 Notice and Waiver of Notice. Whenever any notice is required to be given by law, the Certificate of Incorporation or under
the provisions of these bylaws, said notice shall be deemed to be sufficient if given (i) by
telegraphic, cable or wireless transmission or (ii) by deposit of the same in a post office box in
a sealed prepaid wrapper addressed to the person entitled thereto at his post office address, as it
appears on the records of the Corporation, and such notice shall be deemed to have been given on
the day of such transmission or mailing, as the case may be.
Whenever notice is required to be given by law, the Certificate of Incorporation or under any
of the provisions of these bylaws, a written waiver thereof, signed by the person entitled to
notice or waiver by electronic transmission by such person, whether before or after the time stated
therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall
constitute a waiver of notice of such meeting, except when the person attends a meeting for the
- 13 -
express purpose of objecting, at the beginning of the meeting, to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business to be transacted at,
nor the purpose of, any regular or special meeting of the stockholders, directors, or members of a
committee of directors need be specified in any written waiver of notice unless so required by the
Certificate of Incorporation or the bylaws.
Section 8.03 Resignations. Any director, member of a committee or officer may resign at any time. Such resignation shall
be made in writing and shall take effect at the time specified therein, or if no time be specified,
at the time of its receipt by the chief executive officer or Secretary. The acceptance of a
resignation shall not be necessary to make it effective, unless expressly so provided in the
resignation.
Section 8.04 Facsimile Signatures. In addition to the provisions for the use of facsimile signatures elsewhere specifically
authorized in these bylaws, facsimile signatures of any officer or officers of the Corporation may
be used whenever and as authorized by the Board of Directors.
Section 8.05 Reliance upon Books, Reports and Records. Each director and each member of any committee designated by the Board of Directors shall, in
the performance of his duties, be fully protected in relying in good faith upon the books of
account or reports made to the Corporation by any of its officers, or by an independent certified
public accountant, or by an appraiser selected with reasonable care by the Board of Directors or by
any such committee, or in relying in good faith upon other records of the Corporation.
ARTICLE IX
AMENDMENTS
If provided in the Certificate of Incorporation of the Corporation, the Board of Directors
shall have the power to adopt, amend and repeal from time to time bylaws of the Corporation,
subject to the right of the stockholders entitled to vote with respect thereto to amend or repeal
such bylaws as adopted or amended by the Board of Directors.
- 14 -
exv4w10
Exhibit 4.10
[Form of Senior Indenture]
TARGA RESOURCES PARTNERS LP
TARGA RESOURCES PARTNERS FINANCE CORP.
as Issuers,
any Subsidiary Guarantors party hereto,
and
[ ],
as Trustee
INDENTURE
Dated as of
Debt Securities
CROSS-REFERENCE TABLE
|
|
|
|
|
TIA Section |
Indenture Section |
310
|
|
(a)
|
|
7.10 |
|
|
(b)
|
|
7.10 |
|
|
(c)
|
|
N.A. |
311
|
|
(a)
|
|
7.11 |
|
|
(b)
|
|
7.11 |
|
|
(c)
|
|
N.A. |
312
|
|
(a)
|
|
5.01 |
|
|
(b)
|
|
5.02 |
|
|
(c)
|
|
5.02 |
313
|
|
(a)
|
|
5.03 |
|
|
(b)
|
|
5.03 |
|
|
(c)
|
|
13.03 |
|
|
(d)
|
|
5.03 |
314
|
|
(a)
|
|
4.05 |
|
|
(b)
|
|
N.A. |
|
|
(c)(1)
|
|
13.05 |
|
|
(c)(2)
|
|
13.05 |
|
|
(c)(3)
|
|
N.A. |
|
|
(d)
|
|
N.A. |
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(e)
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13.05 |
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(f)
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N.A. |
315
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(a)
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7.01 |
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(b)
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6.07 & 13.03 |
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(c)
|
|
7.01 |
|
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(d)
|
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7.01 |
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|
(e)
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|
6.08 |
316
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|
(a) (last sentence)
|
|
1.01 |
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(a)(1)(A)
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6.06 |
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(a)(1)(B)
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6.06 |
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(a)(2)
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9.01(d) |
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(b)
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6.04 |
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(c)
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5.04 |
317
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|
(a)(1)
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6.02 |
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(a)(2)
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6.02 |
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(b)
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4.04 |
318
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|
(a)
|
|
13.07 |
N.A. means Not Applicable
NOTE: This Cross-Reference table shall not, for any purpose, be deemed part of this Indenture.
TABLE OF CONTENTS
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Page |
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ARTICLE I |
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DEFINITIONS AND INCORPORATION BY REFERENCE |
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Section 1.01
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Definitions
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1 |
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Section 1.02
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Other Definitions
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6 |
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Section 1.03
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Incorporation by Reference of Trust Indenture Act
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7 |
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Section 1.04
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Rules of Construction
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7 |
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ARTICLE II |
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DEBT SECURITIES |
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Section 2.01
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Forms Generally
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7 |
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Section 2.02
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Form of Trustees Certificate of Authentication
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7 |
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Section 2.03
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Principal Amount; Issuable in Series
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8 |
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Section 2.04
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Execution of Debt Securities
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10 |
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Section 2.05
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Authentication and Delivery of Debt Securities
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11 |
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Section 2.06
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Denomination of Debt Securities
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12 |
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Section 2.07
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Registration of Transfer and Exchange
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12 |
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Section 2.08
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Temporary Debt Securities
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14 |
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Section 2.09
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Mutilated, Destroyed, Lost or Stolen Debt Securities
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14 |
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Section 2.10
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Cancellation of Surrendered Debt Securities
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15 |
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Section 2.11
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Provisions of the Indenture and Debt Securities for the Sole Benefit of the Parties and the Holders
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15 |
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Section 2.12
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Payment of Interest; Interest Rights Preserved
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15 |
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Section 2.13
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Securities Denominated in Dollars
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16 |
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Section 2.14
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Wire Transfers
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16 |
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Section 2.15
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Securities Issuable in the Form of a Global Security
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16 |
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Section 2.16
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Medium Term Securities
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19 |
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Section 2.17
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Defaulted Interest
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19 |
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Section 2.18
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CUSIP Numbers
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20 |
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ARTICLE III |
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REDEMPTION OF DEBT SECURITIES |
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Section 3.01
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Applicability of Article
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20 |
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Section 3.02
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Notice of Redemption; Selection of Debt Securities
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20 |
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Section 3.03
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Payment of Debt Securities Called for Redemption
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22 |
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Section 3.04
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Mandatory and Optional Sinking Funds
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22 |
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Section 3.05
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Redemption of Debt Securities for Sinking Fund
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23 |
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ARTICLE IV |
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PARTICULAR COVENANTS OF THE ISSUERS |
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Section 4.01
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Payment of Principal of, and Premium, If Any, and Interest on, Debt Securities
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24 |
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Section 4.02
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Maintenance of Offices or Agencies for Registration of Transfer, Exchange and Payment of Debt Securities
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25 |
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-ii-
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Page |
Section 4.03
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Appointment to Fill a Vacancy in the Office of Trustee
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25 |
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Section 4.04
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Duties of Paying Agents, etc
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25 |
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Section 4.05
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SEC Reports; Financial Statements
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26 |
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Section 4.06
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Compliance Certificate
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27 |
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Section 4.07
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Further Instruments and Acts
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27 |
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Section 4.08
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Existence
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27 |
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Section 4.09
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Maintenance of Properties
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27 |
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Section 4.10
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Payment of Taxes and Other Claims
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28 |
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Section 4.11
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Waiver of Certain Covenants
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28 |
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ARTICLE V |
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HOLDERS LISTS AND REPORTS BY THE TRUSTEE |
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Section 5.01
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Issuers to Furnish Trustee Information as to Names and Addresses of
Holders; Preservation of Information
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28 |
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Section 5.02
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Communications to Holders
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29 |
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Section 5.03
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Reports by Trustee
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29 |
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Section 5.04
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Record Dates for Action by Holders
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29 |
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ARTICLE VI |
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REMEDIES OF THE TRUSTEE AND HOLDERS IN EVENT OF DEFAULT |
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Section 6.01
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Events of Default
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29 |
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Section 6.02
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Collection of Debt by Trustee, etc
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32 |
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Section 6.03
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Application of Moneys Collected by Trustee
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33 |
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Section 6.04
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Limitation on Suits by Holders
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34 |
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Section 6.05
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Remedies Cumulative; Delay or Omission in Exercise of Rights Not a Waiver of Default
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34 |
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Section 6.06
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Rights of Holders of Majority in Principal Amount of Debt Securities to Direct Trustee and to Waive Default
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34 |
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Section 6.07
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Trustee to Give Notice of Events of Defaults Known to It, but May Withhold Such Notice in Certain Circumstances
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35 |
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Section 6.08
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Requirement of an Undertaking to Pay Costs in Certain Suits under the Indenture or Against the Trustee
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35 |
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ARTICLE VII |
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CONCERNING THE TRUSTEE |
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Section 7.01
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Certain Duties and Responsibilities
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36 |
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Section 7.02
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Certain Rights of Trustee
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37 |
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Section 7.03
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Trustee Not Liable for Recitals in Indenture or in Debt Securities
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38 |
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Section 7.04
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Trustee, Paying Agent or Registrar May Own Debt Securities
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38 |
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Section 7.05
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|
Moneys Received by Trustee to Be Held in Trust
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38 |
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Section 7.06
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Compensation and Reimbursement
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38 |
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Section 7.07
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Right of Trustee to Rely on an Officers Certificate Where No Other Evidence Specifically Prescribed
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39 |
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Section 7.08
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Separate Trustee; Replacement of Trustee
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39 |
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Section 7.09
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Successor Trustee by Merger
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40 |
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Section 7.10
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Eligibility; Disqualification
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41 |
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Section 7.11
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|
Preferential Collection of Claims Against Issuers
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|
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41 |
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-iii-
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Page |
Section 7.12
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|
Compliance with Tax Laws
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41 |
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ARTICLE VIII |
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CONCERNING THE HOLDERS |
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Section 8.01
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|
Evidence of Action by Holders
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41 |
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Section 8.02
|
|
Proof of Execution of Instruments and of Holding of Debt Securities
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|
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42 |
|
Section 8.03
|
|
Who May Be Deemed Owner of Debt Securities
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|
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42 |
|
Section 8.04
|
|
Instruments Executed by Holders Bind Future Holders
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42 |
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ARTICLE IX |
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SUPPLEMENTAL INDENTURES |
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Section 9.01
|
|
Purposes for Which Supplemental Indenture May Be Entered into Without Consent of Holders
|
|
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43 |
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Section 9.02
|
|
Modification of Indenture with Consent of Holders of Debt Securities
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|
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45 |
|
Section 9.03
|
|
Effect of Supplemental Indentures
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46 |
|
Section 9.04
|
|
Debt Securities May Bear Notation of Changes by Supplemental Indentures
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46 |
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ARTICLE X |
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CONSOLIDATION, MERGER, SALE OR CONVEYANCE |
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Section 10.01
|
|
Consolidations and Mergers of the Issuers
|
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46 |
|
Section 10.02
|
|
Rights and Duties of Successor Company
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47 |
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ARTICLE XI |
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|
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SATISFACTION AND DISCHARGE OF INDENTURE; DEFEASANCE; UNCLAIMED MONEYS |
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|
Section 11.01
|
|
Applicability of Article
|
|
|
47 |
|
Section 11.02
|
|
Satisfaction and Discharge of Indenture; Defeasance
|
|
|
47 |
|
Section 11.03
|
|
Conditions of Defeasance
|
|
|
48 |
|
Section 11.04
|
|
Application of Trust Money
|
|
|
49 |
|
Section 11.05
|
|
Repayment to Issuers
|
|
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50 |
|
Section 11.06
|
|
Indemnity for U.S. Government Obligations
|
|
|
50 |
|
Section 11.07
|
|
Reinstatement
|
|
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50 |
|
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|
|
ARTICLE XII |
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|
|
[RESERVED] |
|
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|
|
This Article XII has been intentionally omitted |
|
|
50 |
|
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ARTICLE XIII |
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|
|
MISCELLANEOUS PROVISIONS |
|
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|
Section 13.01
|
|
Successors and Assigns of Issuers Bound by Indenture
|
|
|
50 |
|
Section 13.02
|
|
Acts of Board, Committee or Officer of Successor Issuer Valid
|
|
|
50 |
|
Section 13.03
|
|
Required Notices or Demands
|
|
|
50 |
|
Section 13.04
|
|
Indenture and Debt Securities to Be Construed in Accordance with the Laws of the State of New York
|
|
|
51 |
|
Section 13.05
|
|
Officers Certificate and Opinion of Counsel to Be Furnished upon Application or Demand by the Issuers
|
|
|
52 |
|
-iv-
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Page |
Section 13.06
|
|
Payments Due on Legal Holidays
|
|
|
52 |
|
Section 13.07
|
|
Provisions Required by TIA to Control
|
|
|
52 |
|
Section 13.08
|
|
Computation of Interest on Debt Securities
|
|
|
52 |
|
Section 13.09
|
|
Rules by Trustee, Paying Agent and Registrar
|
|
|
52 |
|
Section 13.10
|
|
No Recourse Against Others
|
|
|
53 |
|
Section 13.11
|
|
Severability
|
|
|
53 |
|
Section 13.12
|
|
Effect of Headings
|
|
|
53 |
|
Section 13.13
|
|
Indenture May Be Executed in Counterparts
|
|
|
53 |
|
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|
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ARTICLE XIV |
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|
|
|
GUARANTEE |
|
|
|
|
|
|
|
|
|
|
|
Section 14.01
|
|
Unconditional Guarantee
|
|
|
53 |
|
Section 14.02
|
|
Execution and Delivery of Guarantee
|
|
|
55 |
|
Section 14.03
|
|
Limitation on Subsidiary Guarantors Liability
|
|
|
55 |
|
Section 14.04
|
|
Release of Subsidiary Guarantors from Guarantee
|
|
|
56 |
|
Section 14.05
|
|
Subsidiary Guarantor Contribution
|
|
|
56 |
|
|
Notation of Guarantee |
|
Annex A
|
-v-
THIS INDENTURE dated as of is among Targa Resources Partners LP, a Delaware
limited partnership (the Partnership), Targa Resources Partners Finance Corp. (Finance Corp.,
and together with the Partnership, the Issuers), any Subsidiary Guarantors (as defined herein)
party hereto and [ ], a
, as trustee (the Trustee).
RECITALS OF THE ISSUERS AND ANY SUBSIDIARY GUARANTORS
The Issuers and any Subsidiary Guarantors have duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of the Issuers debentures, notes,
bonds or other evidences of indebtedness to be issued in one or more series unlimited as to
principal amount (herein called the Debt Securities), which Debt Securities may be guaranteed by
each of the Subsidiary Guarantors, as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the Issuers and any
Subsidiary Guarantors, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH
That in order to declare the terms and conditions upon which the Debt Securities are
authenticated, issued and delivered, and in consideration of the premises, and of the purchase and
acceptance of the Debt Securities by the Holders thereof, the Issuers, any Subsidiary Guarantor and
the Trustee covenant and agree with each other, for the benefit of the respective Holders from time
to time of the Debt Securities or any series thereof, as follows:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 10.1 Definitions.
Affiliate of any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified Person. For the
purposes of this definition, control when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms controlling and
controlled have meanings correlative to the foregoing. The Trustee may request and may
conclusively rely upon an Officers Certificate to determine whether any Person is an Affiliate of
any specified Person.
Agent means any Registrar or paying agent.
Bankruptcy Law means Title 11, U.S. Code or any similar federal or state law for the relief
of debtors.
Board of Directors means, (i) with respect to Finance Corp., the board of directors of the
corporation or any committee thereof duly authorized to act on behalf of such board, (ii) with
respect to the Partnership, the Board of Directors of the General Partner or any authorized
committee of the Board of Directors of the General Partner or any directors and/or officers of the
-1-
General Partner to whom such Board of Directors or such committee shall have duly delegated its
authority to act hereunder. If the Partnership shall change its form of entity to other than a
limited partnership, the references to the Board of Directors of the General Partner shall mean the
Board of Directors (or other comparable governing body) of the Partnership.
Business Day means any day other than a Legal Holiday.
capital stock of any Person means and includes any and all shares, rights to purchase,
warrants or options (whether or not currently exercisable), participations or other equivalents of
or interests in (however designated) the equity (which includes, but is not limited to, common
stock, preferred stock and partnership and joint venture interests) of such Person (excluding any
debt securities that are convertible into, or exchangeable for, such equity).
Custodian means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
Debt of any Person at any date means any obligation created or assumed by such Person for
the repayment of borrowed money and any guarantee thereof.
Debt Security or Debt Securities has the meaning stated in the first recital of this
Indenture and more particularly means any debt security or debt securities, as the case may be, of
any series authenticated and delivered under this Indenture.
Default means any event, act or condition that is, or after notice or the passage of time or
both would be, an Event of Default.
Depositary means, unless otherwise specified by the Issuers pursuant to either Section 2.03
or 2.15, with respect to Debt Securities of any series issuable or issued in whole or in part in
the form of one or more Global Securities, The Depository Trust Company, New York, New York, or any
successor thereto registered as a clearing agency under the Exchange Act or other applicable
statute or regulations.
Dollar or $ means such currency of the United States as at the time of payment is legal
tender for the payment of public and private debts.
Exchange Act means the Securities Exchange Act of 1934, as amended, and any successor
statute.
Finance Corp. means the Person named as Finance Corp. in the first paragraph of this
instrument until a successor Person shall have become such pursuant to the applicable terms of this
Indenture, and thereafter Finance Corp. shall mean such successor Person.
Floating Rate Security means a Debt Security that provides for the payment of interest at a
variable rate determined periodically by reference to an interest rate index specified pursuant to
Section 2.03.
GAAP means generally accepted accounting principles in the United States, as in effect from
time to time.
-2-
General Partner means Targa Resources GP LLC, a Delaware limited liability company, and its
successors and permitted assigns as general partner of the Partnership or as the business entity
with the ultimate authority to manage the business and operations of the Partnership.
Global Security means with respect to any series of Debt Securities issued hereunder, a Debt
Security which is executed by the Issuers and authenticated and delivered by the Trustee to the
Depositary or pursuant to the Depositarys instruction, all in accordance with this Indenture and
any Indentures supplemental hereto, or resolution of the Board of Directors and set forth in an
Officers Certificate, which shall be registered in the name of the Depositary or its nominee and
which shall represent, and shall be denominated in an amount equal to the aggregate principal
amount of, all the Outstanding Debt Securities of such series or any portion thereof, in either
case having the same terms, including, without limitation, the same original issue date, date or
dates on which principal is due and interest rate or method of determining interest.
guarantee means any obligation, contingent or otherwise, of any Person directly or
indirectly guaranteeing any Debt or other obligation of any other Person and any obligation, direct
or indirect, contingent or otherwise, of such Person (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Debt or other obligation of such other Person (whether
arising by virtue of partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial statement conditions or
otherwise) or (b) entered into for purposes of assuring in any other manner the obligee of such
Debt or other obligation of the payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part); provided, however, that the term guarantee shall not include
endorsements for collection or deposit in the ordinary course of business. The term guarantee
used as a verb has a corresponding meaning.
Holder, Holder of Debt Securities or other similar terms means, a Person in whose name a
Debt Security is registered in the Debt Security Register (as defined in Section 2.07(a)).
Indenture means this instrument as originally executed, or, if amended or supplemented as
herein provided, as so amended or supplemented and shall include the form and terms of particular
series of Debt Securities as contemplated hereunder, whether or not a supplemental Indenture is
entered into with respect thereto.
Issuers means the Partnership and Finance Corp.
Issuer Order means a written request or order signed on behalf of each of the Issuers by one
of its Officers and delivered to the Trustee.
Legal Holiday means a Saturday, a Sunday or a day on which banking institutions in the City
of Houston, Texas, City of New York, New York or at a Place of Payment are authorized by law,
regulation or executive order
to remain closed. If a payment date is a Legal Holiday at a Place of Payment, payment may be
made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue for the intervening period.
-3-
Lien means, with respect to any asset, any mortgage, lien, security interest, pledge, charge
or other encumbrance of any kind in respect of such asset, whether or not filed, recorded or
otherwise perfected under applicable law.
Officer means, with respect to any Person, the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer,
any Assistant Treasurer, the Controller, the Secretary or any Vice President of such Person (or, if
such Person is a limited partnership, the general partner of such Person, except it shall be the
General Partner in the case of the Partnership so long as it is a limited partnership).
Officers Certificate means a certificate signed on behalf of each Issuer by any two of its
Officers, one of whom must be the principal executive officer, the principal financial officer or
the principal accounting officer of such Issuer, that meets the requirements of Section 13.05
hereof.
Opinion of Counsel means a written opinion from legal counsel who is acceptable to the
Trustee. The counsel may be an employee of or counsel to the Partnership or the Trustee.
Original Issue Discount Debt Security means any Debt Security which provides for an amount
less than the principal amount thereof to be due and payable upon a declaration of acceleration of
the maturity thereof pursuant to Section 6.01.
Outstanding, when used with respect to any series of Debt Securities, means, as of the date
of determination, all Debt Securities of that series theretofore authenticated and delivered under
this Indenture, except:
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(a) |
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Debt Securities of that series theretofore canceled by the Trustee or delivered to the Trustee
for cancellation; |
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(b) |
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Debt Securities of that series for whose payment or redemption money in the necessary amount
has been theretofore deposited with the Trustee or any paying agent (other than an Issuer) in trust
or set aside and segregated in trust by the Issuers (if an Issuer shall act as its own paying
agent) for the Holders of such Debt Securities; provided, that, if such Debt Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made; and |
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(c) |
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Debt Securities of that series which have been paid pursuant to Section 2.09 or in exchange for
or in lieu of which other Debt Securities have been authenticated and delivered pursuant to this
Indenture, other than any such Debt Securities in respect of which there shall have been presented
to the Trustee proof satisfactory to it that such Debt Securities are held by a protected purchaser
in whose hands such Debt Securities are valid obligations of the Issuers; |
provided, however, that in determining whether the Holders of the requisite principal amount of the
Outstanding Debt Securities of any series have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Debt Securities owned by either of the Issuers or any other
obligor upon the Debt Securities or any Affiliate of the Partnership or of such other
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obligor shall
be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Debt Securities which a Trust Officer actually knows to be so owned shall
be so disregarded. Debt Securities so owned which have been pledged in good faith may be regarded
as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgees right so to
act with respect to such Debt Securities and that the pledgee is not an Issuer or any other obligor
upon the Debt Securities or an Affiliate of the Partnership or of such other obligor. In
determining whether the Holders of the requisite principal amount of Outstanding Debt Securities
have given any request, demand, authorization, direction, notice, consent or waiver hereunder, the
principal amount of an Original Issue Discount Debt Security that shall be deemed to be Outstanding
for such purposes shall be the amount of the principal thereof that would be due and payable as of
the date of such determination upon a declaration of acceleration of the maturity thereof pursuant
to Section 6.01.
Partnership means the Person named as the Partnership in the first paragraph of this
instrument until a successor Person shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter Partnership shall mean such successor Person.
Person means any individual, corporation, partnership, joint venture, limited liability
company, incorporated or unincorporated association, joint-stock company, trust, unincorporated
organization or government or other agency or political subdivision thereof or other entity of any
kind.
Redemption Date, when used with respect to any Debt Security to be redeemed, means the date
fixed for such redemption by or pursuant to this Indenture.
SEC means the Securities and Exchange Commission.
Securities Act means the Securities Act of 1933, as amended, and any successor statute.
Stated Maturity means, with respect to any security, the date specified in such security as
the fixed date on which the payment of principal of such security is due and payable, including
pursuant to any mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has occurred).
Subsidiary of any Person means:
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(1) |
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any corporation, association or other business entity of which more than 50% of the total
voting power of equity interests entitled, without regard to the occurrence of any contingency, to
vote in the election of directors, managers, trustees or equivalent Persons thereof is at the time
of determination owned or controlled, directly or indirectly, by such Person or one or more of the
other Subsidiaries of such Person or combination thereof; or |
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|
(2) |
|
in the case of a partnership, more than 50% of the partners equity interests, considering all
partners equity interests as a single class, is at such time of determination owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person or
combination thereof. |
Subsidiary Guarantors means any Subsidiary of the Partnership (except Finance Corp.) who may
execute this Indenture, or a supplement hereto, for the purpose of providing a Guarantee of Debt
Securities pursuant to this Indenture until a successor Person shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter Subsidiary Guarantors shall mean such
successor Person.
TIA means the Trust Indenture Act of 1939, as amended (15 U.S.C. §§ 77aaa-77bbbb), as in
effect on the date of this Indenture as originally executed and, to the extent required by law, as
amended.
Trustee initially means [ ] and any other Person or Persons appointed as
such from time to time pursuant to Section 7.08, and, subject to the provisions of Article VII,
includes its or their successors and assigns. If at any time there is more than one such Person,
Trustee as used with respect to the Debt Securities of any series shall mean the Trustee with
respect to the Debt Securities of that series.
Trust Officer means any officer or assistant officer of the Trustee assigned by the Trustee
to administer its corporate trust matters.
United States means the United States of America (including the States and the District of
Columbia), its territories, its possessions and other areas subject to its jurisdiction.
U.S. Government Obligations means direct obligations of the United States of America,
obligations on which the payment of principal and interest is fully guaranteed by the United States
of America or obligations or guarantees for the payment of which the full faith and credit of the
United States of America is pledged.
Yield to Maturity means the yield to maturity, calculated at the time of issuance of a
series of Debt Securities, or, if applicable, at the most recent redetermination of interest on
such series and calculated in accordance with accepted financial practice.
Section 1.02 Other Definitions.
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Term |
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Defined in Section |
Debt Security Register |
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2.07 |
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Defaulted Interest |
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2.17 |
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Event of Default |
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6.01 |
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Funding Guarantor |
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14.05 |
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Guarantee |
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14.01 |
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Place of Payment |
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2.03 |
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Registrar |
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2.07 |
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Successor Company |
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10.01 |
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Section 1.03 Incorporation by Reference of Trust Indenture Act. Whenever this Indenture refers to
a provision of the TIA, the provision is incorporated by reference in and made a part of this
Indenture.
All terms used in this Indenture that are defined by the TIA, defined by TIA reference to
another statute or defined by SEC rule under the TIA have the meanings so assigned to them.
Section 1.04 Rules of Construction. Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to it in accordance with
GAAP;
(c) or is not exclusive;
(d) words in the singular include the plural, and in the plural include the singular;
(e) provisions apply to successive events and transactions; and
(f) the principal amount of any noninterest bearing or other discount security at any date shall
be the principal amount thereof that would be shown on a balance sheet of the issuer dated such
date prepared in accordance with GAAP.
ARTICLE II
DEBT SECURITIES
Section 2.01 Forms Generally. The Debt Securities of each series shall be in substantially the
form established without the approval of any Holder by or pursuant to a resolution of the Board of
Directors of each Issuer or in one or more Indentures supplemental hereto, in each case with such
appropriate insertions, omissions, substitutions and other variations as are required or permitted
by this Indenture, and may have such letters, numbers or other marks of identification and such
legends or endorsements placed thereon as the Issuers may deem appropriate (and, if not contained
in a supplemental Indenture entered into in accordance with Article IX, as are not prohibited by
the provisions of this Indenture) or as may be required or appropriate to comply with any law or
with any rules made pursuant thereto or with any rules of any securities exchange on which such
series of Debt Securities may be listed, or to conform to general usage, or as may, consistently
herewith, be determined by the officers executing such Debt Securities as evidenced by their
execution of the Debt Securities.
The definitive Debt Securities of each series shall be printed, lithographed or engraved on
steel engraved borders or may be produced in any other manner, all as determined by the officers
executing such Debt Securities, as evidenced by their execution of such Debt Securities.
Section 2.02 Form of Trustees Certificate of Authentication. The Trustees certificate of
authentication on all Debt Securities authenticated by the Trustee shall be in substantially the
following form:
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TRUSTEES CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series designated therein referred to in the
within-mentioned Indenture.
Section 2.03 Principal Amount; Issuable in Series. The aggregate principal amount of Debt
Securities which may be issued, executed, authenticated, delivered and outstanding under this
Indenture is unlimited.
The Debt Securities may be issued in one or more series in fully registered form. There shall
be established, without the approval of any Holders, in or pursuant to a resolution of the Board of
Directors of each Issuer and set forth in an Officers Certificate, or established in one or more
Indentures supplemental hereto, prior to the issuance of Debt Securities of any series any or all
of the following:
(a) the title of the Debt Securities of the series (which shall distinguish the Debt Securities of
the series from all other Debt Securities);
(b) any limit upon the aggregate principal amount of the Debt Securities of the series which may
be authenticated and delivered under this Indenture (except for Debt Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of, other Debt
Securities of the series pursuant to this Article II);
(c) the date or dates on which the principal of and premium, if any, on the Debt Securities of the
series are payable;
(d) the rate or rates (which may be fixed or variable) at which the Debt Securities of the series
shall bear interest, if any, or the method of determining such rate or rates, the date or dates
from which such interest shall accrue, the interest payment dates on which such interest shall be
payable, or the method by which such date will be determined, the record dates for the
determination of Holders thereof to whom such interest is payable; and the basis upon which
interest will be calculated if other than that of a 360-day year of twelve thirty-day months;
(e) the place or places, if any, in addition to or instead of the corporate trust office of the
Trustee, where the principal of, and premium, if any, and interest on, Debt Securities of the
series shall be payable (Place of Payment);
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(f) the price or prices at which, the period or periods within which and the terms and conditions
upon which Debt Securities of the series may be redeemed, in whole or in part, at the option of the
Issuers or otherwise;
(g) whether Debt Securities of the series are entitled to the benefits of any Guarantee of any
Subsidiary Guarantors pursuant to this Indenture;
(h) the obligation, if any, of the Issuers to redeem, purchase or repay Debt Securities of the
series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof,
and the price or prices at which and the period or periods within which and the terms and
conditions upon which Debt Securities of the series shall be redeemed, purchased or repaid, in
whole or in part, pursuant to such obligations;
(i) the terms, if any, upon which the Debt Securities of the series may be convertible into or
exchanged for capital stock (which may be represented by depositary shares), other Debt Securities
or warrants for capital stock or Debt or other securities of any kind of either of the Issuers or
any other obligor and the terms and conditions upon which such conversion or exchange shall be
effected, including the initial conversion or exchange price or rate, the conversion or exchange
period and any other provision in addition to or in lieu of those described herein;
(j) if other than denominations of $1,000 and any integral multiple thereof, the denominations in
which Debt Securities of the series shall be issuable;
(k) if the amount of principal of or any premium or interest on Debt Securities of the series may
be determined with reference to an index or pursuant to a formula, the manner in which such amounts
will be determined;
(l) if the principal amount payable at the Stated Maturity of Debt Securities of the series will
not be determinable as of any one or more dates prior to such Stated Maturity, the amount which
will be deemed to be such principal amount as of any such date for any purpose, including the
principal amount thereof which will be due and payable upon any maturity other than the Stated
Maturity or which will be deemed to be Outstanding as of any such date (or, in any such case, the
manner in which such deemed principal amount is to be determined);
(m) any changes or additions to Article XI, including the addition of additional covenants that
may be subject to the covenant defeasance option pursuant to Section 11.02(b);
(n) if other than the principal amount thereof, the portion of the principal amount of Debt
Securities of the series which shall be payable upon declaration of acceleration of the maturity
thereof pursuant to Section 6.01 or provable in bankruptcy pursuant to Section 6.02;
(o) the terms, if any, of the transfer, mortgage, pledge or assignment as security for the Debt
Securities of the series of any properties, assets, moneys, proceeds, securities or other
collateral, including whether certain provisions of the TIA are applicable and any corresponding
changes to provisions of this Indenture as currently in effect;
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(p) any addition to or change in the Events of Default with respect to the Debt Securities of the
series and any change in the right of the Trustee or the Holders to declare the principal of, and
premium and interest on, such Debt Securities due and payable;
(q) if the Debt Securities of the series shall be issued in whole or in part in the form of a
Global Security or Securities, the terms and conditions, if any, upon which such Global Security or
Securities may be exchanged in whole or in part for other individual Debt Securities in definitive
registered form; and the Depositary for such Global Security or Securities and the form of any
legend or legends to be borne by any such Global Security or Securities in addition to or in lieu
of the legend referred to in Section 2.15(a);
(r) any trustees, authenticating or paying agents, transfer agents or registrars;
(s) the applicability of, and any addition to or change in the covenants and definitions currently
set forth in this Indenture or in the terms currently set forth in Article X, including
conditioning any merger, conveyance, transfer or lease permitted by Article X upon the satisfaction
of any Debt coverage standard by the Issuers and Successor Company (as defined in Article X);
(t) with regard to Debt Securities of the series that do not bear interest, the dates for certain
required reports to the Trustee; and
(u) any other terms of the Debt Securities of the series (which terms shall not be prohibited by
the provisions of this Indenture).
All Debt Securities of any one series shall be substantially identical except as to
denomination and except as may otherwise be provided in or pursuant to such resolution of the Board
of Directors and as set forth in such Officers Certificate or in any such Indenture supplemental
hereto.
Section 2.04 Execution of Debt Securities. The Debt Securities shall be signed on behalf of each
of the Issuers by at least one of its Officers. Such signatures upon the Debt Securities may be
the manual or facsimile signatures of the present or any future such authorized officers and may be
imprinted or otherwise reproduced on the Debt Securities.
Only such Debt Securities as shall bear thereon a certificate of authentication substantially
in the form hereinbefore recited, signed manually by the Trustee, shall be entitled to the benefits
of this Indenture or be valid or obligatory for any purpose. Such certificate by the Trustee upon
any Debt Security executed on behalf of each of
the Issuers by at least one of its Officers shall be conclusive evidence that the Debt
Security so authenticated has been duly authenticated and delivered hereunder.
In case any Officer of either Issuer who shall have signed any of the Debt Securities shall
cease to be such Officer before the Debt Securities so signed shall have been authenticated and
delivered by the Trustee, or disposed of by the Issuers, such Debt Securities nevertheless may be
authenticated and delivered or disposed of as though the Person who signed such Debt Securities had
not ceased to be such Officer; and any Debt Security may be signed on behalf of either Issuer by
such Persons as, at the actual date of the execution of such Debt Security, shall be the
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proper
Officers of such Issuer, although at the date of such Debt Security or of the execution of this
Indenture any such Person was not such Officer.
Section 2.05 Authentication and Delivery of Debt Securities. At any time and from time to time
after the execution and delivery of this Indenture, the Issuers may deliver to the Trustee for
authentication Debt Securities of any series executed by the Issuers, and the Trustee shall
thereupon authenticate and deliver said Debt Securities to or upon an Issuer Order. In
authenticating such Debt Securities, and accepting the additional responsibilities under this
Indenture in relation to such Debt Securities, the Trustee shall be entitled to receive, and
(subject to Section 7.01) shall be fully protected in relying upon:
(a) a copy of any resolution or resolutions of the Board of Directors of each Issuer, certified by
the Secretary or Assistant Secretary of each of the General Partner and Finance Corp., authorizing
the terms of issuance of any series of Debt Securities;
(b) an executed supplemental Indenture, if any;
(c) an Officers Certificate; and
(d) an Opinion of Counsel prepared in accordance with Section 13.05 which shall also state:
(i) that the form of such Debt Securities has been established by or pursuant to a
resolution of the Board of Directors of each Issuer or by a supplemental Indenture as
permitted by Section 2.01 in conformity with the provisions of this Indenture;
(ii) that the terms of such Debt Securities have been established by or pursuant to a
resolution of the Board of Directors or by a supplemental Indenture as permitted by Section
2.03 in conformity with the provisions of this Indenture;
(iii) that such Debt Securities, when authenticated and delivered by the Trustee and issued
by the Issuers in the manner and subject to any conditions specified in such Opinion of
Counsel, will constitute valid and legally binding obligations of the Issuers, enforceable
in accordance with their terms except as the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors rights
generally and rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability;
(iv) that the Issuers have the power to issue such Debt Securities and has duly taken all
necessary action with respect to such issuance;
(v) that the issuance of such Debt Securities will not contravene the organizational
documents of the Issuers or result in any material violation of any of the terms or
provisions of any law or regulation or of any material indenture, mortgage or other
agreement known to such counsel by which the Issuers are bound;
-11-
(vi) that authentication and delivery of such Debt Securities and the execution and delivery
of any supplemental Indenture will not violate the terms of this Indenture; and
(vii) such other matters as the Trustee may reasonably request.
Such Opinion of Counsel need express no opinion as to whether a court in the United States
would render a money judgment in a currency other than that of the United States.
The Trustee shall have the right to decline to authenticate and deliver any Debt Securities
under this Section 2.05 if the Trustee, being advised by counsel, determines that such action may
not lawfully be taken or if the Trustee in good faith by its board of directors or trustees,
executive committee or a trust committee of directors, trustees or Officers (or any combination
thereof) shall determine that such action would expose the Trustee to personal liability to
existing Holders.
The Trustee may appoint an authenticating agent reasonably acceptable to the Issuers to
authenticate Debt Securities of any series. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Debt Securities whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes authentication by such agent.
An authenticating agent has the same rights as any Registrar, paying agent or agent for service of
notices and demands.
Unless otherwise provided in the form of Debt Security for any series, each Debt Security
shall be dated the date of its authentication.
Section 2.06 Denomination of Debt Securities. Unless otherwise provided in the form of Debt
Security for any series, the Debt Securities of each series shall be issuable only as fully
registered Debt Securities in such Dollar denominations as shall be specified or contemplated by
Section 2.03. In the absence of any such specification with respect to the Debt Securities of any
series, the Debt Securities of such series shall be issuable in denominations of $1,000 and any
integral multiple thereof.
Section 2.07 Registration of Transfer and Exchange.
(a) The Issuers shall keep or cause to be kept a register for each series of Debt Securities
issued hereunder (hereinafter collectively referred to as the Debt Security Register), in which,
subject to such reasonable regulations as it may prescribe, the Issuers shall provide for the
registration of all Debt Securities and the transfer of Debt Securities as in this Article II
provided. At all reasonable times the Debt Security Register shall be open for inspection by the
Trustee. Subject to Section 2.15, upon due presentment for registration of transfer of any Debt
Security at any office or agency to be maintained by the Issuers in accordance with the provisions
of Section 4.02, the Issuers shall execute and the Trustee shall authenticate and deliver in the
name of the transferee or transferees a new Debt Security or Debt Securities of authorized
denominations for a like aggregate principal amount. In no event may Debt Securities be issued as,
or exchanged for, bearer securities.
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Unless and until otherwise determined by the Issuers by resolutions of each Issuers Board of
Directors, the Debt Security Register shall be kept at the principal corporate trust office of the
Trustee and, for this purpose, the Trustee shall be designated Registrar.
Debt Securities of any series (other than a Global Security, except as set forth below) may be
exchanged for a like aggregate principal amount of Debt Securities of the same series of other
authorized denominations. Subject to
Section 2.15, Debt Securities to be exchanged shall be surrendered at the office or agency to
be maintained by the Issuers as provided in Section 4.02, and the Issuers shall execute and the
Trustee shall authenticate and deliver in exchange therefor the Debt Security or Debt Securities
which the Holder making the exchange shall be entitled to receive.
(b) All Debt Securities presented or surrendered for registration of transfer, exchange or payment
shall (if so required by the Issuers, the Trustee or the Registrar) be duly endorsed or be
accompanied by a written instrument or instruments of transfer, in form satisfactory to the
Issuers, the Trustee and the Registrar, duly executed by the Holder or his attorney duly authorized
in writing.
All Debt Securities issued in exchange for or upon transfer of Debt Securities shall be the
valid obligations of the Issuers, evidencing the same debt, and entitled to the same benefits under
this Indenture as the Debt Securities surrendered for such exchange or transfer.
No service charge shall be made for any exchange or registration of transfer of Debt
Securities (except as provided by Section 2.09), but the Issuers may require payment of a sum
sufficient to cover any tax, fee, assessment or other governmental charge that may be imposed in
relation thereto, other than those expressly provided in this Indenture to be made at the Issuers
own expense or without expense or without charge to the Holders.
The Issuers shall not be required (i) to issue, register the transfer of or exchange any Debt
Securities for a period of 15 days next preceding any mailing of notice of redemption of Debt
Securities of such series or (ii) to register the transfer of or exchange any Debt Securities
selected, called or being called for redemption.
Prior to the due presentation for registration of transfer of any Debt Security, the Issuers,
the Subsidiary Guarantors, the Trustee, any paying agent or any Registrar may deem and treat the
Person in whose name a Debt Security is registered as the absolute owner of such Debt Security for
the purpose of receiving payment of or on account of the principal of, and premium, if any, and
(subject to Section 2.12) interest on, such Debt Security and for all other purposes whatsoever,
whether or not such Debt Security is overdue, and none of the Issuers, the Subsidiary Guarantors,
the Trustee, any paying agent or any Registrar shall be affected by notice to the contrary.
None of the Issuers, the Subsidiary Guarantors, the Trustee, any agent of the Trustee, any
paying agent or any Registrar will have any responsibility or liability for any aspect of the
records relating to, or payments made on account of, beneficial ownership interests of a Global
Security or for maintaining, supervising or reviewing any records relating to such beneficial
ownership interests.
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Section 2.08 Temporary Debt Securities. Pending the preparation of definitive Debt
Securities of any series, the Issuers may execute and the Trustee shall authenticate and deliver
temporary Debt Securities (printed, lithographed, photocopied, typewritten or otherwise produced)
of any authorized denomination, and substantially in the form of the definitive Debt Securities in
lieu of which they are issued, in registered form with such omissions, insertions and variations as
may be appropriate for temporary Debt Securities, all as may be determined by the Issuers with the
concurrence of the Trustee. Temporary Debt Securities may contain such reference to any provisions
of this Indenture as may be appropriate. Every temporary Debt Security shall be executed by the
Issuers and be authenticated by the Trustee upon the same conditions and in substantially the same
manner, and with like effect, as the definitive Debt Securities.
If temporary Debt Securities of any series are issued, the Issuers will cause definitive Debt
Securities of such series to be prepared without unreasonable delay. After the preparation of
definitive Debt Securities of such series, the temporary Debt Securities of such series shall be
exchangeable for definitive Debt Securities of such series upon surrender of the temporary Debt
Securities of such series at the office or agency of the Issuers at a Place of Payment for such
series, without charge to the Holder thereof, except as provided in Section 2.07 in connection with
a transfer. Upon surrender for cancellation of any one or more temporary Debt Securities of any
series, the Issuers shall execute and the Trustee shall authenticate and deliver in exchange
therefor a like principal amount of definitive Debt Securities of the same series of authorized
denominations and of like tenor. Until so exchanged, temporary Debt Securities of any series shall
in all respects be entitled to the same benefits under this Indenture as definitive Debt Securities
of such series.
Upon any exchange of a portion of a temporary Global Security for a definitive Global Security
or for the individual Debt Securities represented thereby pursuant to Section 2.07 or this Section
2.08, the temporary Global Security shall be endorsed by the Trustee to reflect the reduction of
the principal amount evidenced thereby, whereupon the principal amount of such temporary Global
Security shall be reduced for all purposes by the amount to be exchanged and endorsed.
Section 2.09 Mutilated, Destroyed, Lost or Stolen Debt Securities. If (a) any
mutilated Debt Security is surrendered to the Trustee at its corporate trust office or (b) the
Issuers and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of
any Debt Security, and there is delivered to the Issuers and the Trustee such security or indemnity
as may be required by them to save each of them and any paying agent harmless, and neither the
Issuers nor the Trustee receives notice that such Debt Security has been acquired by a protected
purchaser, then the Issuers shall execute and, upon an Issuer Order, the Trustee shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Debt
Security, a new Debt Security of the same series of like tenor, form, terms and principal amount,
bearing a number not contemporaneously Outstanding. Upon the issuance of any substituted Debt
Security, the Issuers or the Trustee may require the payment of a sum sufficient to cover any tax,
fee, assessment or other governmental charge that may be imposed in relation thereto and any other
expenses connected therewith. In case any Debt Security which has matured or is about to mature or
which has been called for redemption shall become mutilated or be destroyed, lost or stolen, the
Issuers may, instead of issuing a substituted Debt Security, pay or authorize the
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payment of the same (without surrender thereof except in the case of a mutilated Debt
Security) if the applicant for such payment shall furnish the Issuers and the Trustee with such
security or indemnity as either may require to save it harmless from all risk, however remote, and,
in case of destruction, loss or theft, evidence to the satisfaction of the Issuers and the Trustee
of the destruction, loss or theft of such Debt Security and of the ownership thereof.
Every substituted Debt Security of any series issued pursuant to the provisions of this
Section 2.09 by virtue of the fact that any Debt Security is destroyed, lost or stolen shall
constitute an original additional contractual obligation of the Issuers, whether or not the
destroyed, lost or stolen Debt Security shall be found at any time, and shall be entitled to all
the benefits of this Indenture equally and proportionately with any and all other Debt Securities
of that series duly issued hereunder. All Debt Securities shall be held and owned upon the express
condition that the foregoing provisions are exclusive with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Debt Securities, and shall preclude any and all other rights
or remedies, notwithstanding any law or statute existing or hereafter enacted to the contrary with
respect to the replacement or payment of negotiable instruments or other securities without their
surrender.
Section 2.10 Cancellation of Surrendered Debt Securities. All Debt Securities
surrendered for payment, redemption, registration of transfer or exchange shall, if surrendered to
an Issuer or any paying agent or a Registrar, be delivered to the Trustee for cancellation by it,
or if surrendered to the Trustee, shall be canceled by it, and no Debt Securities shall be issued
in lieu thereof except as expressly permitted by any of the provisions of this Indenture. All
canceled Debt Securities held by the Trustee shall be destroyed (subject to the record retention
requirements of the Exchange Act) and certification of their destruction delivered to the Issuers,
unless otherwise directed. On request of the Issuers, the Trustee shall deliver to the Issuers
canceled Debt Securities held by the Trustee. If either of the Issuers shall acquire any of the
Debt Securities, however, such acquisition shall not operate as a redemption or satisfaction of the
Debt represented thereby unless and until the same are delivered or surrendered to the Trustee for
cancellation. The Issuers may not issue new Debt Securities to replace Debt Securities it has
redeemed, paid or delivered to the Trustee for cancellation.
Section 2.11 Provisions of the Indenture and Debt Securities for the Sole Benefit of the
Parties and the Holders. Nothing in this Indenture or in the Debt Securities, expressed or
implied, shall give or be construed to give to any Person, other than the parties hereto, the
Holders or any Registrar or paying agent, any legal or equitable right, remedy or claim under or in
respect of this Indenture, or under any covenant, condition or provision herein contained; all its
covenants, conditions and provisions being for the sole benefit of the parties hereto, the Holders
and any Registrar and paying agents.
Section 2.12 Payment of Interest; Interest Rights Preserved.
(a) Interest on any Debt Security that is payable and is punctually paid or duly provided for
on any interest payment date shall be paid to the Person in whose name such Debt Security is
registered at the close of business on the regular record date for such interest notwithstanding
the cancellation of such Debt Security upon any transfer or exchange subsequent to the regular
record date. Payment of interest on Debt Securities shall be made at the corporate
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trust office of the Trustee (except as otherwise specified pursuant to Section 2.03), or at
the option of the Issuers, by check mailed to the address of the Person entitled thereto as such
address shall appear in the Debt Security Register or, if provided pursuant to Section 2.03 and in
accordance with arrangements satisfactory to the Trustee, at the option of the Holder by wire
transfer to an account designated by the Holder.
(b) Subject to the foregoing provisions of this Section 2.12 and Section 2.17, each Debt
Security of a particular series delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Debt Security of the same series shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other Debt Security.
Section 2.13 Securities Denominated in Dollars. Except as otherwise specified
pursuant to Section 2.03 for Debt Securities of any series, payment of the principal of, and
premium, if any, and interest on, Debt Securities of such series will be made in Dollars.
Section 2.14 Wire Transfers. Notwithstanding any other provision to the contrary in
this Indenture, the Issuers may make any payment of moneys required to be deposited with the
Trustee on account of principal of, or premium, if any, or interest on, the Debt Securities
(whether pursuant to optional or mandatory redemption payments, interest payments or otherwise) by
wire transfer in immediately available funds to an account designated by the Trustee before 11:00
a.m., New York City time, on the date such moneys are to be paid to the Holders of the Debt
Securities in accordance with the terms hereof.
Section 2.15 Securities Issuable in the Form of a Global Security.
(a) If the Issuers shall establish pursuant to Sections 2.01 and 2.03 that the Debt Securities
of a particular series are to be issued in whole or in part in the form of one or more Global
Securities, then the Issuers shall execute and the Trustee or its agent shall, in accordance with
Section 2.05, authenticate and deliver, such Global Security or Securities, which shall represent,
and shall be denominated in an amount equal to the aggregate principal amount of, the Outstanding
Debt Securities of such series to be represented by such Global Security or Securities, or such
portion thereof as the Issuers shall specify in an Officers Certificate, shall be registered in
the name of the Depositary for such Global Security or Securities or its nominee, shall be
delivered by the Trustee or its agent to the Depositary or pursuant to the Depositarys instruction
and shall bear a legend substantially to the following effect:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (DTC), NEW YORK, NEW YORK, TO THE ISSUERS OR THEIR AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
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TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSORS NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO HEREIN.
or such other legend as may then be required by the Depositary for such Global Security or
Securities.
(b) Notwithstanding any other provision of this Section 2.15 or of Section 2.07 to the
contrary, and subject to the provisions of paragraph (c) below, unless the terms of a Global
Security expressly permit such Global Security to be exchanged in whole or in part for definitive
Debt Securities in registered form, a Global Security may be transferred, in whole but not in part
and in the manner provided in Section 2.07, only by the Depositary to a nominee of the Depositary
for such Global Security, or by a nominee of the Depositary to the Depositary or another nominee of
the Depositary, or by the Depositary or a nominee of the Depositary to a successor Depositary for
such Global Security selected or approved by the Issuers, or to a nominee of such successor
Depositary.
(c) (i) If at any time the Depositary for a Global Security or Securities notifies the Issuers
that it is unwilling or unable to continue as Depositary for such Global Security or Securities or
if at any time the Depositary for the Debt Securities for such series shall no longer be eligible
or in good standing under the Exchange Act or other applicable statute, rule or regulation, the
Issuers shall appoint a successor Depositary with respect to such Global Security or Securities.
If a successor Depositary for such Global Security or Securities is not appointed by the Issuers
within 90 days after the Issuers receive such notice or becomes aware of such ineligibility, the
Issuers shall execute, and the Trustee or its agent, upon receipt of an Issuer Order for the
authentication and delivery of such individual Debt Securities of such series in exchange for such
Global Security or Securities, will authenticate and deliver, individual Debt Securities of such
series of like tenor and terms in definitive form in an aggregate principal amount equal to the
principal amount of the Global Security or Securities in exchange for such Global Security or
Securities.
(ii) If an Event of Default occurs and the Depositary for a Global Security or
Securities notifies the Trustee of its decision to require that the Debt Securities of any
series or portion thereof issued or issuable in the form of one or more Global Securities
shall no longer be represented by such Global Security or Securities, the Issuers shall
appoint a successor Depositary with respect to such Global Security or Securities. In such
event the Issuers will execute, and the Trustee, upon receipt of an Issuer Order for the
authentication and delivery of individual Debt Securities of such series in exchange in
whole or in part for such Global Security or Securities, will authenticate and deliver
individual Debt Securities of such series of like tenor and terms in definitive form in an
aggregate principal amount equal to the principal amount of such series or portion thereof
in exchange for such Global Security or Securities.
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(iii) If specified by the Issuers pursuant to Sections 2.01 and 2.03 with respect to
Debt Securities issued or issuable in the form of a Global Security, the Depositary for such
Global Security may surrender such Global Security in exchange in whole or in part for
individual Debt Securities of such series of like tenor and terms in definitive form on such
terms as are acceptable to the Issuers, the Trustee and such Depositary. Thereupon the
Issuers shall execute, and the Trustee or its agent upon receipt of an Issuer Order for the
authentication and delivery of definitive Debt Securities of such series shall authenticate
and deliver, without service charge, to each Person specified by such Depositary a new Debt
Security or Securities of the same series of like tenor and terms and of any authorized
denomination as requested by such Person in aggregate principal amount equal to and in
exchange for such Persons beneficial interest in the Global Security; and to such
Depositary a new Global Security of like tenor and terms and in an authorized denomination
equal to the difference, if any, between the principal amount of the surrendered Global
Security and the aggregate principal amount of Debt Securities delivered to Holders thereof.
(iv) In any exchange provided for in any of the preceding three paragraphs, the
Issuers will execute and the Trustee or its agent will authenticate and deliver individual
Debt Securities. Upon the exchange of the entire principal amount of a Global Security for
individual Debt Securities, such Global Security shall be canceled by the Trustee or its
agent. Except as provided in the preceding paragraph, Debt Securities issued in exchange
for a Global Security pursuant to this Section 2.15 shall be registered in such names and in
such authorized denominations as the Depositary for such Global Security, pursuant to
instructions from its direct or indirect participants or otherwise, shall instruct the
Trustee or the Registrar. The Trustee or the Registrar shall deliver such Debt Securities
to the Persons in whose names such Debt Securities are so registered.
(v) Payments in respect of the principal of and interest on any Debt Securities
registered in the name of the Depositary or its nominee will be payable to the Depositary or
such nominee in its capacity as the registered owner of such Global Security. The Issuers,
any Subsidiary Guarantors and the Trustee may treat the Person in whose name the Debt
Securities, including the Global Security, are registered as the owner thereof for the
purpose of receiving such payments and for any and all other purposes whatsoever. None of
the Issuers, any Subsidiary Guarantors, the Trustee, any Registrar, the paying agent or any
agent of the Issuers, any Subsidiary Guarantors or the Trustee will have any responsibility
or liability for any aspect of the records relating to or payments made on account of the
beneficial ownership interests of the Global Security by the Depositary or its nominee or
any of the Depositarys direct or indirect participants, or for maintaining, supervising or
reviewing any records of the Depositary, its nominee or any of its direct or indirect
participants relating to the beneficial ownership interests of the Global Security, the
payments to the beneficial owners of the Global Security of amounts paid to the Depositary
or its nominee, or any other matter relating to the actions and practices of the
Depositary, its nominee or any of its direct or indirect participants. None of the Issuers,
any Subsidiary Guarantors, the Trustee or any such agent will be liable for any delay by the
Depositary, its nominee, or any of its direct or indirect participants in identifying the
beneficial owners of the Debt Securities, and the Issuers, any Subsidiary Guarantors and the
Trustee may conclusively rely on, and will be protected in relying on, instructions
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from the Depositary or its nominee for all purposes (including with respect to the
registration and delivery, and the respective principal amounts, of the Debt Securities to
be issued).
Section 2.16 Medium Term Securities. Notwithstanding any contrary provision herein,
if all Debt Securities of a series are not to be originally issued at one time, it shall not be
necessary for each of the Issuers to deliver to the Trustee an Officers Certificate, resolutions
of each such Issuers Board of Directors, supplemental Indenture, Opinion of Counsel or written
order or any other document otherwise required pursuant to Section 2.01, 2.03, 2.05 or 13.05 at or
prior to the time of authentication of each Debt Security of such series if such documents are
delivered to the Trustee or its agent at or prior to the authentication upon original issuance of
the first such Debt Security of such series to be issued; provided, that any subsequent request by
the Issuers to the Trustee to authenticate Debt Securities of such series upon original issuance
shall constitute a representation and warranty by the Issuers that, as of the date of such request,
the statements made in the Officers Certificate delivered pursuant to Section 2.05 or 13.05 shall
be true and correct as if made on such date and that the Opinion of Counsel delivered at or prior
to such time of authentication of an original issuance of Debt Securities shall specifically state
that it shall relate to all subsequent issuances of Debt Securities of such series that are
identical to the Debt Securities issued in the first issuance of Debt Securities of such series.
An Issuer Order delivered by the Issuers to the Trustee in the circumstances set forth in the
preceding paragraph, may provide that Debt Securities which are the subject thereof will be
authenticated and delivered by the Trustee or its agent on original issue from time to time upon
the telephonic or written order of Persons designated in such written order (any such telephonic
instructions to be promptly confirmed in writing by such Person) and that such Persons are
authorized to determine, consistent with the Officers Certificate, supplemental Indenture or
resolution of the Board of Directors relating to such written order, such terms and conditions of
such Debt Securities as are specified in such Officers Certificate, supplemental Indenture or such
resolution.
Section 2.17 Defaulted Interest. Any interest on any Debt Security of a particular
series which is payable, but is not punctually paid or duly provided for, on the dates and in the
manner provided in the Debt Securities of such series and in this Indenture (herein called
Defaulted Interest) shall forthwith cease to be payable to the Holder thereof on the relevant
record date by virtue of having been such Holder, and such Defaulted Interest may be paid by the
Issuers, at their election in each case, as provided in clause (i) or (ii) below:
(i) The Issuers may elect to make payment of any Defaulted Interest to the Persons in
whose names the Debt Securities of such series are registered at the close of business on a
special record date for the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Issuers shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each such Debt Security of such series and the
date of the proposed payment, and at the same time the Issuers shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such
deposit prior to the date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted
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Interest as in this clause provided. Thereupon the Trustee shall fix a special record
date for the payment of such Defaulted Interest which shall be not more than 15 days and not
less than 10 days prior to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The Trustee shall
promptly notify the Issuers of such special record date and, in the name and at the expense
of the Issuers, shall cause notice of the proposed payment of such Defaulted Interest and
the special record date therefor to be mailed, first class postage pre-paid, to each Holder
thereof at its address as it appears in the Debt Security Register, not less than 10 days
prior to such special record date. Notice of the proposed payment of such Defaulted
Interest and the special record date therefor having been so mailed, such Defaulted Interest
shall be paid to the Persons in whose names the Debt Securities of such series are
registered at the close of business on such special record date.
(ii) The Issuers may make payment of any Defaulted Interest on the Debt Securities of
such series in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Debt Securities of such series may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the Issuers to the
Trustee of the proposed payment pursuant to this clause, such manner of payment shall be
deemed practicable by the Trustee.
Section 2.18 CUSIP Numbers. The Issuers in issuing the Debt Securities may use
CUSIP numbers (if then generally in use), and, if so, the Trustee shall use CUSIP numbers in
notices of redemption as a convenience to Holders; provided that any such notice may state that no
representation is made as to the accuracy of such numbers either as printed on the Debt Securities
or as contained in any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Debt Securities, and any such redemption shall not be
affected by any defect in or omission of such numbers. The Issuers will promptly notify the
Trustee in writing of any change in the CUSIP numbers.
ARTICLE III
REDEMPTION OF DEBT SECURITIES
Section 3.01 Applicability of Article. The provisions of this Article shall be
applicable to the Debt Securities of any series which are redeemable before their Stated Maturity
except as otherwise specified as contemplated by Section 2.03 for Debt Securities of such series.
Section 3.02 Notice of Redemption; Selection of Debt Securities. In case the Issuers
shall desire to exercise the right to redeem all or, as the case may be, any part of the Debt
Securities of any series in accordance with their terms, by resolution of the Board of Directors of
each Issuer or a supplemental Indenture, the Issuers shall fix a date for redemption and shall give
notice of such redemption at least 30 and not more than 60 days prior to the date fixed for
redemption to the Holders of Debt Securities of such series so to be redeemed as a whole or in
part, in the manner provided in Section 13.03. The notice if given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the Holder receives such
notice. In any case, failure to give such notice or any defect in the notice to the Holder of any
Debt Security of a series designated for redemption as a whole or in part shall not affect the
validity of the proceedings for the redemption of any other Debt Security of such series.
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Each such notice of redemption shall specify (i) the date fixed for redemption, (ii) the
redemption price at which Debt Securities of such series are to be redeemed (or the method of
calculating such redemption price), (iii) the Place or Places of Payment that payment will be made
upon presentation and surrender of such Debt Securities, (iv) that any interest accrued to the date
fixed for redemption will be paid as specified in said notice, (v) that the redemption is for a
sinking fund payment (if applicable), (vi) that, unless otherwise specified in such notice, if the
Issuers default in making such redemption payment the paying agent is prohibited from making such
payment pursuant to the terms of this Indenture, (vii) that on and after said date any interest
thereon or on the portions thereof to be redeemed will cease to accrue, (viii) that in the case of
Original Issue Discount Securities original issue discount accrued after the date fixed for
redemption will cease to accrue, (ix) the terms of the Debt Securities of that series pursuant to
which the Debt Securities of that series are being redeemed and (x) that no representation is made
as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on
the Debt Securities of that series. If less than all the Debt Securities of a series are to be
redeemed the notice of redemption shall specify the certificate numbers of any Debt Securities of
that series to be redeemed that are not in global form. In case any Debt Security of a series is
to be redeemed in part only, the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the date fixed for redemption, upon
surrender of such Debt Security, a new Debt Security or Debt Securities of that series in principal
amount equal to the unredeemed portion thereof, will be issued.
At least five days before the giving of any notice of redemption, unless the Trustee consents
to a shorter period, the Issuers shall give written notice to the Trustee of the Redemption Date,
the principal amount of Debt Securities to be redeemed and the series and terms of the Debt
Securities pursuant to which such redemption will occur. Such notice shall be accompanied by an
Officers Certificate and an Opinion of Counsel from the Issuers to the effect that such redemption
will comply with the conditions herein, and such notice may be revoked at any time prior to the
giving of a notice of redemption to the Holders pursuant to this Section 3.02. If fewer than all
the Debt Securities of a series are to be redeemed, the record date relating to such redemption
shall be selected by the Issuers and given in writing to the Trustee, which record date shall be
not less than three days after the date of notice to the Trustee.
By 11 a.m., New York City time, on the Redemption Date for any Debt Securities, the Issuers
shall deposit with the Trustee or with a paying agent (or, if an Issuer is acting as its own paying
agent, segregate and hold in trust) an amount of money in Dollars (except as provided pursuant to
Section 2.03) sufficient to pay the redemption price of such Debt Securities or any portions
thereof that are to be redeemed on that date, together with any interest accrued to the Redemption
Date.
If less than all the Debt Securities of like tenor and terms of a series are to be redeemed
(other than pursuant to mandatory sinking fund redemptions), the Trustee shall select, on a pro
rata basis, by lot or by such other method as in its sole discretion it shall deem appropriate and
fair, the Debt Securities of that series or portions thereof (in multiples of $1,000) to be
redeemed. In any case where more than one Debt Security of such series is registered in the same
name, the Trustee in its discretion may treat the aggregate principal amount so registered as if it
were represented by one Debt Security of such series. The Trustee shall promptly notify the
Issuers in writing of the Debt Securities selected for redemption and, in the case of any Debt
Securities
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selected for partial redemption, the principal amount thereof to be redeemed. If any Debt
Security called for redemption shall not be so paid upon surrender thereof on such Redemption Date,
the principal, premium, if any, and interest shall bear interest until paid from the Redemption
Date at the rate borne by the Debt Securities of that series. If less than all the Debt Securities
of unlike tenor and terms of a series are to be redeemed, the particular Debt Securities to be
redeemed shall be selected by the Issuers. Provisions of this Indenture that apply to Debt
Securities called for redemption also apply to portions of Debt Securities called for redemption.
Section 3.03 Payment of Debt Securities Called for Redemption. If notice of
redemption has been given as provided in Section 3.02, the Debt Securities or portions of Debt
Securities of the series with respect to which such notice has been given shall become due and
payable on the date and at the Place or Places of Payment stated in such notice at the applicable
redemption price, together with any interest accrued to the date fixed for redemption, and on and
after said date (unless the Issuers shall default in the payment of such Debt Securities at the
applicable redemption price, together with any interest accrued to said date) any interest on the
Debt Securities or portions of Debt Securities of any series so called for redemption shall cease
to accrue, and any original issue discount in the case of Original Issue Discount Securities shall
cease to accrue. On presentation and surrender of such Debt Securities at the Place or Places of
Payment in said notice specified, the said Debt Securities or the specified portions thereof shall
be paid and redeemed by the Issuers at the applicable redemption price, together with any interest
accrued thereon to the date fixed for redemption.
Any Debt Security that is to be redeemed only in part shall be surrendered at the Place of
Payment with, if the Issuers, the Registrar or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Issuers, the Registrar and the Trustee
duly executed by, the Holder thereof or his attorney duly authorized in writing, and the Issuers
shall execute, and the Trustee shall authenticate and deliver to the Holder of such Debt Security
without service charge, a new Debt Security or Debt Securities of the same series, of like tenor
and form, of any authorized denomination as requested by such Holder in aggregate principal amount
equal to and in exchange for the unredeemed portion of the principal of the Debt Security so
surrendered; except that if a Global Security is so surrendered, the Issuers shall execute, and the
Trustee shall authenticate and deliver to the Depositary for such Global Security, without service
charge, a new Global Security in a denomination equal to and in exchange for the unredeemed portion
of the principal of the Global Security so surrendered. In the case of a Debt Security providing
appropriate space for such notation, at the option of the Holder thereof, the Trustee, in lieu of
delivering a new Debt Security or Debt Securities as aforesaid, may make a notation on such Debt
Security of the payment of the redeemed portion thereof.
Section 3.04 Mandatory and Optional Sinking Funds. The minimum amount of any sinking
fund payment provided for by the terms of Debt Securities of any series, resolution of the Board of
Directors or a supplemental Indenture is herein referred to as a mandatory sinking fund payment,
and any payment in excess of such minimum amount provided for by the terms of Debt Securities of
any series, resolution of the Board of Directors or a supplemental Indenture is herein referred to
as an optional sinking fund payment.
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In lieu of making all or any part of any mandatory sinking fund payment with respect to any
Debt Securities of a series in cash, the Issuers may at their option (a) deliver to the Trustee
Debt Securities of that series theretofore purchased or otherwise acquired by the Issuers or (b)
receive credit for the principal amount of Debt Securities of that series which have been redeemed
either at the election of the Issuers pursuant to the terms of such Debt Securities or through the
application of permitted optional sinking fund payments pursuant to the terms of such Debt
Securities, resolution or supplemental Indenture; provided, that such Debt Securities have not been
previously so credited. Such Debt Securities shall be received and credited for such purpose by
the Trustee at the redemption price specified in such Debt Securities, resolution or supplemental
Indenture for redemption through operation of the sinking fund and the amount of such mandatory
sinking fund payment shall be reduced accordingly.
Section 3.05 Redemption of Debt Securities for Sinking Fund. Not less than 60 days
prior to each sinking fund payment date for any series of Debt Securities, the Issuers will deliver
to the Trustee an Officers Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of that series, any resolution or supplemental
Indenture, the portion thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting Debt Securities of that
series pursuant to this Section 3.05 (which Debt Securities, if not previously redeemed, will
accompany such certificate) and whether the Issuers intend to exercise its right to make any
permitted optional sinking fund payment with respect to such series. Such certificate shall also
state that no Event of Default has occurred and is continuing with respect to such series. Such
certificate shall be irrevocable and upon its delivery the Issuers shall be obligated to make the
cash payment or payments therein referred to, if any, by 11 a.m., New York City time, on the next
succeeding sinking fund payment date. Failure of the Issuers to deliver such certificate (or to
deliver the Debt Securities specified in this paragraph) shall not constitute a Default, but such
failure shall require that the sinking fund payment due on the next succeeding sinking fund payment
date for that series shall be paid entirely in cash and shall be sufficient to redeem the principal
amount of such Debt Securities subject to a mandatory sinking fund payment without the option to
deliver or credit Debt Securities as provided in this Section 3.05 and without the right to make
any optional sinking fund payment, if any, with respect to such series.
Any sinking fund payment or payments (mandatory or optional) made in cash plus any unused
balance of any preceding sinking fund payments made in cash which shall equal or exceed $100,000
(or a lesser sum if the Issuers shall so request) with respect to the Debt Securities of any
particular series shall be applied by the Trustee on the sinking fund payment date on which such
payment is made (or, if such payment is made before a sinking fund payment date, on the sinking
fund payment date following the date of such payment) to the redemption of such Debt Securities at
the redemption price specified in such Debt Securities, resolution or supplemental Indenture for
operation of the sinking fund together with any accrued interest to the date fixed for redemption.
Any sinking fund moneys not so applied or allocated by the Trustee to the redemption of Debt
Securities shall be added to the next cash sinking fund payment received by the Trustee for such
series and, together with such payment, shall be applied in accordance with the provisions of this
Section 3.05. Any and all sinking fund moneys with respect to the Debt Securities of any
particular series held by the Trustee on the last sinking fund payment date with respect to Debt
Securities of such series and not held for the payment or redemption of particular Debt Securities
shall be applied by the Trustee, together with other
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moneys, if necessary, to be deposited sufficient for the purpose, to the payment of the
principal of the Debt Securities of that series at its Stated Maturity.
The Trustee shall select the Debt Securities to be redeemed upon such sinking fund payment
date in the manner specified in the last paragraph of Section 3.02 and the Issuers shall cause
notice of the redemption thereof to be given in the manner provided in Section 3.02 except that the
notice of redemption shall also state that the Debt Securities are being redeemed by operation of
the sinking fund. Such notice having been duly given, the redemption of such Debt Securities shall
be made upon the terms and in the manner stated in Section 3.03.
The Trustee shall not redeem any Debt Securities of a series with sinking fund moneys or mail
any notice of redemption of such Debt Securities by operation of the sinking fund for such series
during the continuance of a Default in payment of interest on such Debt Securities or of any Event
of Default (other than an Event of Default occurring as a consequence of this paragraph) with
respect to such Debt Securities, except that if the notice of redemption of any such Debt
Securities shall theretofore have been mailed in accordance with the provisions hereof, the Trustee
shall redeem such Debt Securities if cash sufficient for that purpose shall be deposited with the
Trustee for that purpose in accordance with the terms of this Article III. Except as aforesaid,
any moneys in the sinking fund for such series at the time when any such Default or Event of
Default shall occur and any moneys thereafter paid into such sinking fund shall, during the
continuance of such Default or Event of Default, be held as security for the payment of such Debt
Securities; provided, however, that in case such Default or Event of Default shall have been cured
or waived as provided herein, such moneys shall thereafter be applied on the next sinking fund
payment date for such Debt Securities on which such moneys may be applied pursuant to the
provisions of this Section 3.05.
ARTICLE IV
PARTICULAR COVENANTS OF THE ISSUERS
Section 4.01 Payment of Principal of, and Premium, If Any, and Interest on, Debt
Securities. The Issuers, for the benefit of each series of Debt Securities, will duly and
punctually pay or cause to be paid the principal of, and premium, if any, and interest on, each of
the Debt Securities at the place, at the respective times and in the manner provided herein or in
the Debt Securities. Each installment of interest on any Debt Securities not in global form may at
the Issuers option be paid by mailing checks for such interest payable to the Person entitled
thereto pursuant to Section 2.07(a) to the address of such Person as it appears on the Debt
Security Register.
Principal of and premium and interest on Debt Securities of any series shall be considered
paid on the date due if, by 11 a.m., New York City time, on such date the Trustee or any paying
agent holds in accordance with this Indenture money sufficient to pay all principal, premium and
interest then due.
The Issuers shall pay interest on overdue principal or premium, if any, at the rate specified
therefor in the Debt Securities, and it shall pay interest on overdue installments of interest at
the same rate to the extent lawful.
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Section 4.02 Maintenance of Offices or Agencies for Registration of Transfer, Exchange and
Payment of Debt Securities. The Issuers will maintain in each Place of Payment for any series
of Debt Securities an office or agency where Debt Securities of such series may be presented or
surrendered for payment, and it shall also maintain (in or outside such Place of Payment) an office
or agency where Debt Securities of such series may be surrendered for transfer or exchange and
where notices and demands to or upon the Issuers in respect of the Debt Securities of such series
and this Indenture may be served. The Issuers will give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If at any time the Issuers
shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with
the address thereof, such presentations, surrenders, notices and demands may be made or served at
the office of the Trustee where its corporate trust business is principally administered in the
United States, and the Issuers hereby appoint the Trustee as their agent to receive all
presentations, surrenders, notices and demands.
The Issuers may also from time to time designate different or additional offices or agencies
to be maintained for such purposes (in or outside of such Place of Payment), and may from time to
time rescind any such designation; provided, however, that no such designation or rescission shall
in any manner relieve the Issuers of their obligations described in the preceding paragraph. The
Issuers will give prompt written notice to the Trustee of any such additional designation or
rescission of designation and any change in the location of any such different or additional office
or agency.
Section 4.03 Appointment to Fill a Vacancy in the Office of Trustee. The Issuers,
whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner
provided in Section 7.08, a Trustee, so that there shall at all times be a Trustee hereunder with
respect to each series of Debt Securities.
Section 4.04 Duties of Paying Agents, etc.
(a) The Issuers shall cause each paying agent, if any, other than the Trustee, to execute and
deliver to the Trustee an instrument in which such agent shall agree with the Trustee, subject to
the provisions of this Section 4.04,
(i) that it will hold all sums held by it as such agent for the payment of the
principal of, and premium, if any, or interest on, the Debt Securities of any series
(whether such sums have been paid to it by the Issuers or by any other obligor on the Debt
Securities of such series) in trust for the benefit of the Holders of the Debt Securities of
such series;
(ii) that it will give the Trustee notice of any failure by the Issuers (or by any
other obligor on the Debt Securities of such series) to make any payment of the principal
of, and premium, if any, or interest on, the Debt Securities of such series when the same
shall be due and payable; and
(iii) that it will at any time during the continuance of an Event of Default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held by it as such
agent.
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(b) If either of the Issuers shall act as its own paying agent, it will, on or before each due
date of the principal of, and premium, if any, or interest on, the Debt Securities of any series,
set aside, segregate and hold in trust for the benefit of the Holders of the Debt Securities of
such series a sum sufficient to pay such principal, premium, if any, or interest so becoming due.
The Issuers will promptly notify the Trustee of any failure by either of the Issuers to take such
action or the failure by any other obligor on such Debt Securities to make any payment of the
principal of, and premium, if any, or interest on, such Debt Securities when the same shall be due
and payable.
(c) Anything in this Section 4.04 to the contrary notwithstanding, either of the Issuers may,
at any time, for the purpose of obtaining a satisfaction and discharge of this Indenture, or for
any other reason, pay or cause to be paid to the Trustee all sums held in trust by it or any paying
agent, as required by this Section 4.04, such sums to be held by the Trustee upon the same trusts
as those upon which such sums were held by such Issuer or such paying agent.
(d) Whenever the Issuers shall have one or more paying agents with respect to any series of
Debt Securities, they will, prior to each due date of the principal of, and premium, if any, or
interest on, any Debt Securities of such series, deposit with any such paying agent a sum
sufficient to pay the principal, premium or interest so becoming due, such sum to be held in trust
for the benefit of the Persons entitled thereto, and (unless any such paying agent is the Trustee)
the Issuers will promptly notify the Trustee of its action or failure so to act.
(e) Anything in this Section 4.04 to the contrary notwithstanding, the agreement to hold sums
in trust as provided in this Section 4.04 is subject to the provisions of Section 11.05.
Section 4.05 SEC Reports; Financial Statements.
(a) The Partnership shall, so long as any of the Debt Securities are Outstanding, file with
the Trustee, within 30 days after it files the same with the SEC, copies of the annual reports and
the information, documents and other reports (or copies of such portions of any of the foregoing as
the SEC may by rules and regulations prescribe) that the Partnership is required to file with the
SEC pursuant to Section 13 or 15(d) of the Exchange Act. If the Partnership is not subject to the
requirements of such Section 13 or 15(d), the Partnership shall file with the Trustee, within 30
days after it would have been required to file the same with the SEC, financial statements,
including any notes thereto (and with respect to annual reports, an auditors report by a firm of
established national reputation), and a Managements Discussion and Analysis of Financial
Condition and Results of Operations, both comparable to that which the Partnership would have been
required to include in such annual reports, information, documents or other reports if the
Partnership had been subject to the requirements of such Section 13 or 15 (d). The Issuers shall
also comply with the provisions of TIA Section 314 (a).
(b) The Partnership shall provide the Trustee with a sufficient number of copies of all
reports and other documents and information that the Trustee may be required to deliver to Holders
under this Section.
(c) The Partnership shall, so long as any of the Notes are Outstanding, deliver to the
Trustee, within 30 days of any Officer of the Partnership becoming aware of the occurrence of
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any Event of Default, an Officers Certificate specifying such Event of Default and what
action the Partnership is taking or proposes to take with respect thereto.
Section 4.06 Compliance Certificate.
(a) Each of the Issuers and any Subsidiary Guarantor shall, so long as any of the Debt
Securities are Outstanding, deliver to the Trustee, within 120 days after the end of each fiscal
year of the Partnership, an Officers Certificate stating that a review of the activities of the
Partnership and its Subsidiaries during the preceding fiscal year has been made under the
supervision of the Officers signing the certificate with a view to determining whether each of the
Issuers and any Subsidiary Guarantor has kept, observed, performed and fulfilled its obligations
under this Indenture, and further stating, as to each such Officer signing such certificate, that
to the best of his knowledge each of the Issuers and any Subsidiary Guarantor has kept, observed,
performed and fulfilled each and every covenant contained in this Indenture and is not in default
in the performance or observance of any of the terms, provisions and conditions hereof, without
regard to any grace period or requirement of notice required by this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of Default of which
such Officer may have knowledge and what action the Issuers or any Subsidiary Guarantor is taking
or proposes to take with respect thereto).
(b) The Partnership shall, so long as any of the Debt Securities are Outstanding, deliver to
the Trustee within 30 days after the occurrence of any Default or Event of Default under this
Indenture, an Officers Certificate specifying such Default or Event of Default, the status thereof
and what action the Partnership is taking or proposes to take with respect thereto.
Section 4.07 Further Instruments and Acts. The Partnership will, upon request of the
Trustee, execute and deliver such further instruments and do such further acts as may reasonably be
necessary or proper to carry out more effectually the purposes of this Indenture.
Section 4.08 Existence. Except as permitted by Article X hereof, the Partnership
shall do or cause to be done all things necessary to preserve and keep in full force and effect its
existence and all rights (charter and statutory) and franchises of the Partnership, provided that
the Partnership shall not be required to preserve any such right or franchise, if its Board of
Directors shall determine that the preservation thereof is no longer desirable in the conduct of
the business of the Partnership.
Section 4.09 Maintenance of Properties. The Partnership shall cause all properties
owned by the Partnership or any of its Subsidiaries or used or held for use in the conduct of its
business or the business of any such Subsidiary to be maintained and kept in good condition, repair
and working order (reasonable wear and tear excepted) and supplied with all necessary equipment and
will cause to be made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the judgment of the Partnership may be necessary so that the business carried on
in connection therewith may be properly and advantageously conducted at all times; provided that
nothing in this Section shall prevent the Partnership from discontinuing the operation or
maintenance of any of such properties if such discontinuance is, in the judgment of the
Partnership, desirable in the conduct of its business or the business of any such Subsidiary and
not disadvantageous in any material respect to the Holders.
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Section 4.10 Payment of Taxes and Other Claims. The Partnership shall pay or
discharge or cause to be paid or discharged, before the same shall become delinquent, (i) all
taxes, assessments and governmental charges levied or imposed upon the Partnership or any of its
Subsidiaries or upon the income, profits or property of the Partnership or any of its Subsidiaries,
and (ii) all lawful claims for labor, materials and supplies which, if unpaid, might by law become
a Lien upon the property of the Partnership or any of its Subsidiaries; provided that the
Partnership shall not be required to pay or discharge or cause to be paid or discharged any such
tax, assessment, charge or claim whose amount, applicability or validity is being contested in good
faith by appropriate proceedings.
Section 4.11 Waiver of Certain Covenants. The Issuers and the Subsidiary Guarantors
may, with respect to the Debt Securities of any series, omit in any particular instance to comply
with any covenant set forth in this Article IV (except Sections 4.01 through 4.08) or made
applicable to such Debt Securities pursuant to Section 2.03, if, before or after the time for such
compliance, the Holders of at least a majority in principal amount of the Outstanding Debt
Securities of each series affected, waive such compliance in such instance with such covenant, but
no such waiver shall extend to or affect such covenant except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Issuers and the Subsidiary
Guarantors and the duties of the Trustee in respect of any such covenant shall remain in full force
and effect.
ARTICLE V
HOLDERS LISTS AND REPORTS BY THE TRUSTEE
Section 5.01 Issuers to Furnish Trustee Information as to Names and Addresses of Holders;
Preservation of Information. The Issuers covenant and agree that they will furnish or cause to
be furnished to the Trustee with respect to the Debt Securities of each series:
(a) not more than 10 days after each record date with respect to the payment of interest, if
any, a list, in such form as the Trustee may reasonably require, of the names and addresses of the
Holders as of such record date, and
(b) at such other times as the Trustee may request in writing, within 30 days after the
receipt by the Issuers of any such request, a list of similar form and contents as of a date not
more than 15 days prior to the time such list is furnished;
provided, however, that so long as the Trustee shall be the Registrar, such lists shall not be
required to be furnished.
The Trustee shall preserve, in as current a form as is reasonably practicable, all information
as to the names and addresses of the Holders (i) contained in the most recent list furnished to it
as provided in this Section 5.01 or (ii) received by it in the capacity of paying agent or
Registrar (if so acting) hereunder.
The Trustee may destroy any list furnished to it as provided in this Section 5.01 upon receipt
of a new list so furnished.
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Section 5.02 Communications to Holders. Holders may communicate pursuant to Section
312(b) of the TIA with other Holders with respect to their rights under this Indenture or the Debt
Securities. The Issuers, the Trustee, the Registrar and anyone else shall have the protection of
Section 312(c) of the TIA.
Section 5.03 Reports by Trustee. Within 60 days after each January 31, beginning with
the first January 31 following the date of this Indenture, and in any event on or before April 1 in
each year, the Trustee shall mail to Holders a brief report dated as of such January 31 that
complies with TIA Section 313 (a); provided, however, that if no event described in TIA Section 313
(a) has occurred within the twelve months preceding the reporting date, no report need be
transmitted. The Trustee also shall comply with TIA Section 313 (b).
Reports pursuant to this Section 5.03 shall be transmitted by mail:
(a) to all Holders, as the names and addresses of such Holders appear in the Debt Security
Register; and
(b) except in the cases of reports under Section 313(b)(2) of the TIA, to each Holder of a
Debt Security of any series whose name and address appear in the information preserved at the time
by the Trustee in accordance with Section 5.01.
A copy of each report at the time of its mailing to Holders shall be filed with the Securities
and Exchange Commission and each stock exchange (if any) on which the Debt Securities of any series
are listed. The Issuers agree to notify promptly the Trustee whenever the Debt Securities of any
series become listed on any stock exchange and of any delisting thereof.
Section 5.04 Record Dates for Action by Holders. If the Issuers shall solicit from
the Holders of Debt Securities of any series any action (including the making of any demand or
request, the giving of any direction, notice, consent or waiver or the taking of any other action),
the Issuers may, at their option, by resolution of their respective Boards of Directors, fix in
advance a record date for the determination of Holders of Debt Securities entitled to take such
action, but the Issuers shall have no obligation to do so. Any such record date shall be fixed at
the Issuers discretion. If such a record date is fixed, such action may be sought or given before
or after the record date, but only the Holders of Debt Securities of record at the close of
business on such record date shall be deemed to be Holders of Debt Securities for the purpose of
determining whether Holders of the requisite proportion of Debt Securities of such series
Outstanding have authorized or agreed or consented to such action, and for that purpose the Debt
Securities of such series Outstanding shall be computed as of such record date.
ARTICLE VI
REMEDIES OF THE TRUSTEE AND HOLDERS IN EVENT OF DEFAULT
Section 6.01 Events of Default. If any one or more of the following shall have
occurred and be continuing with respect to Debt Securities of any series (each of the following, an
Event of Default):
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(a) default in the payment of any installment of interest upon any Debt Securities of that
series as and when the same shall become due and payable, and continuance of such default for a
period of 30 days; or
(b) default in the payment of the principal of or premium, if any, on any Debt Securities of
that series as and when the same shall become due and payable, whether at Stated Maturity, upon
redemption, by declaration, upon required repurchase or otherwise; or
(c) default in the payment of any sinking fund payment with respect to any Debt Securities of
that series as and when the same shall become due and payable; or
(d) failure on the part of the Issuers, or if any series of Debt Securities Outstanding under
this Indenture is entitled to the benefits of the Guarantee, any of the Subsidiary Guarantors, duly
to observe or perform any other of the covenants or agreements on the part of the Issuers, or if
applicable, any of the Subsidiary Guarantors, in the Debt Securities of that series, in any
resolution of the Board of Directors authorizing the issuance of that series of Debt Securities, in
this Indenture with respect to such series or in any supplemental Indenture with respect to such
series (other than a covenant a default in the performance of which is elsewhere in this Section
specifically dealt with), continuing for a period of 60 days after the date on which written notice
specifying such failure and requiring the Issuers, or if applicable, the Subsidiary Guarantors, to
remedy the same shall have been given to the Issuers, or if applicable, the Subsidiary Guarantors,
by the Trustee or to the Issuers, or if applicable, the Subsidiary Guarantors, and the Trustee by
the Holders of at least 25% in aggregate principal amount of the Debt Securities of that series at
the time Outstanding; or
(e) either of the Issuers, or if any series of Debt Securities Outstanding under this
Indenture is entitled to the benefits of the Guarantee, any of the Subsidiary Guarantors, pursuant
to or within the meaning of any Bankruptcy Law,
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an involuntary case,
(iii) consents to the appointment of a Custodian of it or for all or substantially all
of its property; or
(iv) makes a general assignment for the benefit of its creditors;
(f) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against either of the Issuers, or if any series of Debt Securities
Outstanding under this Indenture is entitled to the benefits of the Guarantee, any of the
Subsidiary Guarantors, as debtor in an involuntary case,
(ii) appoints a Custodian of either of the Issuers, or if any series of Debt Securities
Outstanding under this Indenture is entitled to the benefits of the Guarantee,
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any of the Subsidiary Guarantors, or a Custodian for all or substantially all of the
property of either of the Issuers, or if applicable, any of the Subsidiary Guarantors, or
(iii) orders the liquidation of either of the Issuers, or if any series of Debt
Securities Outstanding under this Indenture is entitled to the benefits of the Guarantee,
any of the Subsidiary Guarantors,
and the order or decree remains unstayed and in effect for 60 days;
(g) if any series of Debt Securities Outstanding under this Indenture is entitled to the
benefits of the Guarantee, the Guarantee of any of the Subsidiary Guarantors ceases to be in full
force and effect with respect to Debt Securities of that series (except as otherwise provided in
this Indenture) or is declared null and void in a judicial proceeding or any of the Subsidiary
Guarantors denies or disaffirms its obligations under this Indenture or such Guarantee; or
(h) any other Event of Default provided with respect to Debt Securities of that series;
then and in each and every case that an Event of Default described in clause (a), (b), (c), (d),
(g), or (h) with respect to Debt Securities of that series at the time Outstanding occurs and is
continuing, unless the principal of, premium, if any, and accrued and unpaid interest on all the
Debt Securities of that series shall have already become due and payable, either the Trustee or the
Holders of not less than 25% in aggregate principal amount of the Debt Securities of that series
then Outstanding hereunder, by notice in writing to the Issuers (and to the Trustee if given by
Holders), may declare the principal of (or, if the Debt Securities of that series are Original
Issue Discount Debt Securities, such portion of the principal amount as may be specified in the
terms of that series), premium, if any, and interest on all the Debt Securities of that series to
be due and payable immediately, and upon any such declaration the same shall become and shall be
immediately due and payable, anything in this Indenture or in the Debt Securities of that series
contained to the contrary notwithstanding. If an Event of Default described in clause (e) or (f)
occurs with respect to either of the Issuers, then and in each and every such case, unless the
principal of and accrued and unpaid interest on all the Debt Securities shall have become due and
payable, the principal of (or, if the Debt Securities of that series are Original Issue Discount
Debt Securities, such portion of the principal amount as may be specified in the terms thereof),
premium, if any, and interest on all the Debt Securities then Outstanding hereunder shall ipso
facto become and be immediately due and payable without any declaration or other act on the part of
the Trustee or any Holders, anything in this Indenture or in the Debt Securities contained to the
contrary notwithstanding.
The Holders of a majority in aggregate principal amount of the Debt Securities of a particular
series by written notice to the Trustee may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree of a court of competent jurisdiction
already rendered and if all existing Events of Default with respect to that series have been cured
or waived except nonpayment of principal, premium, if any, or interest that has become due solely
because of acceleration. Upon any such rescission, the parties hereto shall be restored
respectively to their several positions and rights hereunder, and all rights, remedies and powers
of the parties hereto shall continue as though no such proceeding had been taken.
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Section 6.02 Collection of Debt by Trustee, etc. If an Event of Default occurs and is
continuing, the Trustee, in its own name and as trustee of an express trust, shall be entitled and
empowered to institute any action or proceedings at law or in equity for the collection of the sums
so due and unpaid or enforce the performance of any provision of the Debt Securities of the
affected series or this Indenture, and may prosecute any such action or proceedings to judgment or
final decree, and may enforce any such judgment or final decree against any of the Subsidiary
Guarantors or the Issuers or any other obligor upon the Debt Securities of such series (and collect
in the manner provided by law out of the property of any of the Subsidiary Guarantors or the
Issuers or any other obligor upon the Debt Securities of such series wherever situated the moneys
adjudged or decreed to be payable).
In case there shall be pending proceedings for the bankruptcy or for the reorganization of any
of the Subsidiary Guarantors or the Issuers or any other obligor upon the Debt Securities of any
series under any Bankruptcy Law, or in case a Custodian shall have been appointed for its property,
or in case of any other similar judicial proceedings relative to any of the Subsidiary Guarantors
or the Issuers or any other obligor upon the Debt Securities of any series, its creditors or its
property, the Trustee, irrespective of whether the principal of Debt Securities of any series shall
then be due and payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand pursuant to the provisions of this Section 6.02,
shall be entitled and empowered, by intervention in such proceedings or otherwise, to file and
prove a claim or claims for the whole amount of principal, premium, if any, and interest (or, if
the Debt Securities of such series are Original Issue Discount Debt Securities, such portion of the
principal amount as may be specified in the terms of such series) owing and unpaid in respect of
the Debt Securities of such series, and to file such other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee (including any claim for reasonable
compensation to the Trustee, its agents, attorneys and counsel, and for reimbursement of all
expenses and liabilities incurred, and all advances made, by the Trustee except as a result of its
negligence or bad faith) and of the Holders thereof allowed in any such judicial proceedings
relative to any of the Subsidiary Guarantors or the Issuers, or any other obligor upon the Debt
Securities of such series, its creditors or its property, and to collect and receive any moneys or
other property payable or deliverable on any such claims, and to distribute all amounts received
with respect to the claims of such Holders and of the Trustee on their behalf, and any receiver,
assignee or trustee in bankruptcy or reorganization is hereby authorized by each of such Holders to
make payments to the Trustee, and, in the event that the Trustee shall consent to the making of
payments directly to such Holders, to pay to the Trustee such amount as shall be sufficient to
cover reasonable compensation to the Trustee, its agents, attorneys and counsel, and all other
reasonable expenses and liabilities incurred, and all advances made, by the Trustee except as a
result of its negligence or bad faith.
All rights of action and of asserting claims under this Indenture, or under any of the Debt
Securities of any series, may be enforced by the Trustee without the possession of any such Debt
Securities, or the production thereof in any trial or other proceedings relative thereto, and any
such action or proceedings instituted by the Trustee shall be brought in its own name as trustee of
an express trust, and any recovery of judgment (except for any amounts payable to the Trustee
pursuant to Section 7.06) shall be for the ratable benefit of the Holders of all the Debt
Securities in respect of which such action was taken.
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In case of an Event of Default hereunder the Trustee may in its discretion proceed to protect
and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as
the Trustee shall deem most effectual to protect and enforce any of such rights, either at law or
in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power granted in this
Indenture, or to enforce any other legal or equitable right vested in the Trustee by this Indenture
or by law.
Section 6.03 Application of Moneys Collected by Trustee. Any moneys or other property
collected by the Trustee pursuant to Section 6.02 with respect to Debt Securities of any series
shall be applied in the order following, at the date or dates fixed by the Trustee for the
distribution of such moneys or other property, upon presentation of the several Debt Securities of
such series in respect of which moneys or other property have been collected, and the notation
thereon of the payment, if only partially paid, and upon surrender thereof if fully paid:
FIRST: To the payment of all money due the Trustee pursuant to Section 7.06;
SECOND: In case the principal of the Outstanding Debt Securities in respect of which such
moneys have been collected shall not have become due, to the payment of interest on the Debt
Securities of such series in the order of the maturity of the installments of such interest, with
interest (to the extent that such interest has been collected by the Trustee) upon the overdue
installments of interest at the rate or Yield to Maturity (in the case of Original Issue Discount
Debt Securities) borne by the Debt Securities of such series, such payments to be made ratably to
the Persons entitled thereto, without discrimination or preference;
THIRD: In case the principal of the Outstanding Debt Securities in respect of which such
moneys have been collected shall have become due, by declaration or otherwise, to the payment of
the whole amount then owing and unpaid upon the Debt Securities of such series for principal and
premium, if any, and interest, with interest on the overdue principal and premium, if any, and (to
the extent that such interest has been collected by the Trustee) upon overdue installments of
interest at the rate or Yield to Maturity (in the case of Original Issue Discount Debt Securities)
borne by the Debt Securities of such series; and, in case such moneys shall be insufficient to pay
in full the whole amount so due and unpaid upon the Debt Securities of such series, then to the
payment of such principal and premium, if any, and interest, without preference or priority of
principal and premium, if any, over interest, or of interest over principal and premium, if any, or
of any installment of interest over any other installment of interest, or of any Debt Security of
such series over any Debt Security of such series, ratably to the aggregate of such principal and
premium, if any, and interest; and
FOURTH: The remainder, if any, shall be paid to the Subsidiary Guarantors or the Issuers, as
applicable, or to whomsoever may be lawfully entitled to receive the same, or as a court of
competent jurisdiction may direct.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this
Section 6.03. At least 15 days before such record date, the Issuers shall mail to each Holder and
the Trustee a notice that states the record date, the payment date and amount to be paid.
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Section 6.04 Limitation on Suits by Holders. No Holder of any Debt Security of any
series shall have any right by virtue or by availing of any provision of this Indenture to
institute any action or proceeding at law or in equity or in bankruptcy or otherwise, upon or under
or with respect to this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless such Holder previously shall have given to the Trustee written
notice of an Event of Default with respect to Debt Securities of that same series and of the
continuance thereof and unless the Holders of not less than 25% in aggregate principal amount of
the Outstanding Debt Securities of that series shall have made written request upon the Trustee to
institute such action or proceedings in respect of such Event of Default in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable indemnity or security as it may
require against the costs, expenses and liabilities to be incurred therein or thereby, and the
Trustee, for 60 days after its receipt of such notice, request and offer of indemnity or security
shall have failed to institute any such action or proceedings and no direction inconsistent with
such written request shall have been given to the Trustee pursuant to Section 6.06; it being
understood and intended, and being expressly covenanted by the Holder of every Debt Security with
every other Holder and the Trustee, that no one or more Holders shall have any right in any manner
whatever by virtue or by availing of any provision of this Indenture to affect, disturb or
prejudice the rights of any Holders, or to obtain or seek to obtain priority over or preference to
any other such Holder, or to enforce any right under this Indenture, except in the manner herein
provided and for the equal, ratable and common benefit of all such Holders. For the protection and
enforcement of the provisions of this Section 6.04, each and every Holder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
Notwithstanding any other provision in this Indenture, however, the right of any Holder of any
Debt Security to receive payment of the principal of, and premium, if any, and (subject to Section
2.12) interest on, such Debt Security, on or after the respective due dates expressed in such Debt
Security, and to institute suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
Section 6.05 Remedies Cumulative; Delay or Omission in Exercise of Rights Not a Waiver of
Default. All powers and remedies given by this Article VI to the Trustee or to the Holders
shall, to the extent permitted by law, be deemed cumulative and not exclusive of any thereof or of
any other powers and remedies available to the Trustee or the Holders, by judicial proceedings or
otherwise, to enforce the performance or observance of the covenants and agreements contained in
this Indenture, and no delay or omission of the Trustee or of any Holder to exercise any right or
power accruing upon any Default occurring and continuing as aforesaid, shall impair any such right
or power, or shall be construed to be a waiver of any such Default or an acquiescence therein; and,
subject to the provisions of Section 6.04, every power and remedy given by this Article VI or by
law to the Trustee or to the Holders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Holders.
Section 6.06 Rights of Holders of Majority in Principal Amount of Debt Securities to
Direct Trustee and to Waive Default. The Holders of not less than a majority in aggregate
principal amount of the Debt Securities of any series at the time Outstanding shall have the right
to direct the time, method and place of conducting any proceeding for any remedy available to the
Trustee, or of exercising any right, trust or power conferred on the Trustee, with respect to the
Debt Securities of such series; provided, however, that such direction shall not be otherwise
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than in accordance with law and the provisions of this Indenture, and that subject to the
provisions of Section 7.01, the Trustee shall have the right to decline to follow any such
direction if the Trustee being advised by counsel shall determine that the action so directed may
not lawfully be taken or is inconsistent with any provision of this Indenture, or if the Trustee
shall by a responsible officer or officers determine that the action so directed would involve it
in personal liability or would be unduly prejudicial to Holders of Debt Securities of such series
not taking part in such direction; and provided, further, however, that nothing in this Indenture
contained shall impair the right of the Trustee to take any action deemed proper by the Trustee and
which is not inconsistent with such direction by such Holders. The Holders of not less than a
majority in aggregate principal amount of the Debt Securities of any series at the time Outstanding
may on behalf of the Holders of all the Debt Securities of that series waive any past Default or
Event of Default and its consequences for that series, except a Default or Event of Default in the
payment of the principal of, and premium, if any, or interest on, any of the Debt Securities and a
Default or Event of Default in respect of a provision that under Section 9.02 cannot be amended
without the consent of each Holder affected thereby. In case of any such waiver, such Default
shall cease to exist, any Event of Default arising therefrom shall be deemed to have been cured for
every purpose of this Indenture, and the Subsidiary Guarantors, the Issuers, the Trustee and the
Holders of the Debt Securities of that series shall be restored to their former positions and
rights hereunder, respectively; but no such waiver shall extend to any subsequent or other Default
or Event of Default or impair any right consequent thereon.
Section 6.07 Trustee to Give Notice of Events of Defaults Known to It, but May Withhold
Such Notice in Certain Circumstances. The Trustee shall, within 90 days after the occurrence
of an Event of Default, or if later, within 30 days after the Trustee obtains actual knowledge of
the Event of Default, with respect to a series of Debt Securities give to the Holders thereof, in
the manner provided in Section 13.03, notice of all Events of Default with respect to such series
known to the Trustee, unless such Events of Default shall have been cured or waived before the
giving of such notice; provided, that, except in the case of an Event of Default in the payment of
the principal of, or premium, if any, or interest on, any of the Debt Securities of such series or
in the making of any sinking fund payment with respect to the Debt Securities of such series, the
Trustee shall be protected in withholding such notice if and so long as the board of directors, the
executive committee or a committee of directors or responsible officers of the Trustee in good
faith determines that the withholding of such notice is in the interests of the Holders thereof.
Section 6.08 Requirement of an Undertaking to Pay Costs in Certain Suits under the
Indenture or Against the Trustee. All parties to this Indenture agree, and each Holder of any
Debt Security by his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or
in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit in the manner and to
the extent provided in the TIA, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 6.08 shall not apply to any suit instituted by the Trustee, to any
suit instituted by any Holder, or group of Holders, holding in the aggregate more than 25 percent
in principal amount of the Outstanding Debt Securities of that series or to any suit instituted by
any
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Holder for the enforcement of the payment of the principal of, or premium, if any, or interest
on, any Debt Security on or after the due date for such payment expressed in such Debt Security.
ARTICLE VII
CONCERNING THE TRUSTEE
Section 7.01 Certain Duties and Responsibilities. The Trustee, prior to the
occurrence of an Event of Default and after the curing or waiving of all Events of Default which
may have occurred, undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture. In case an Event of Default has occurred (which has not been cured or
waived), the Trustee shall exercise such of the rights and powers vested in it by this Indenture,
and use the same degree of care and skill in their exercise, as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the Trustee from liability for
its own negligent action, its own negligent failure to act, its own bad faith or its own willful
misconduct, except that:
(a) this paragraph shall not be construed to limit the effect of the first paragraph of this
Section 7.01;
(b) prior to the occurrence of an Event of Default with respect to the Debt Securities of a
series and after the curing or waiving of all Events of Default with respect to such series which
may have occurred:
(i) the duties and obligations of the Trustee with respect to Debt Securities of any
series shall be determined solely by the express provisions of this Indenture, and the
Trustee shall not be liable except for the performance of such duties and obligations with
respect to such series as are specifically set forth in this Indenture, and no implied
covenants or obligations with respect to such series shall be read into this Indenture
against the Trustee;
(ii) in the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture; but in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether or not they conform
to the requirements of this Indenture; but the Trustee shall examine the evidence furnished
to it pursuant to Sections 4.05 and 4.06 to determine whether or not such evidence conforms
to the requirement of this Indenture;
(iii) the Trustee shall not be liable for an error of judgment made in good faith by a
responsible officer, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(iv) the Trustee shall not be liable with respect to any action taken or omitted to be
taken by it with respect to Debt Securities of any series in good faith in accordance
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with the direction of the Holders of not less than a majority in aggregate principal
amount of the Outstanding Debt Securities of that series relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Indenture with respect to Debt
Securities of such series.
None of the provisions of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any personal financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there shall be reasonable grounds
for believing that repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
Whether or not therein expressly so provided, every provision of this Indenture relating to
the conduct or affecting the liability of or affording protection to the Trustee shall be subject
to the provisions of this Section.
Section 7.02 Certain Rights of Trustee. Except as otherwise provided in Section 7.01:
(a) the Trustee may rely and shall be protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note or other paper or document (whether in its original or
facsimile form) believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) any request, direction, order or demand of either of the Issuers mentioned herein shall be
sufficiently; evidenced by an Issuer Order (unless other evidence in respect thereof be herein
specifically prescribed); and any resolution of the Board of Directors of an Issuer may be
evidenced to the Trustee by a copy thereof certified by its Secretary or an Assistant Secretary;
(c) the Trustee may consult with counsel, and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection in respect of any action taken or
suffered or omitted by it hereunder in good faith and in accordance with such advice or Opinion of
Counsel;
(d) the Trustee shall be under no obligation to exercise any of the rights or powers vested in
it by this Indenture at the request, order or direction of any of the Holders of Debt Securities of
any series pursuant to the provisions of this Indenture, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the costs, expenses and liabilities which may
be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or omitted by it in good faith and
reasonably believed by it to be authorized or within the discretion or rights or powers conferred
upon it by this Indenture;
(f) prior to the occurrence of an Event of Default and after the curing of all Events of
Default which may have occurred, the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, approval or other paper or document, unless requested
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in writing to do so by the Holders of a majority in aggregate principal amount of the then
Outstanding Debt Securities of a series affected by such matter; provided, however, that if the
payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is not, in the opinion of the Trustee,
reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture,
the Trustee may require reasonable indemnity against such costs, expenses or liabilities as a
condition to so proceeding, and the reasonable expense of every such investigation shall be paid by
the Issuers or, if paid by the Trustee, shall be repaid by the Issuers upon demand;
(g) the Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys and the Trustee shall not be
responsible for any misconduct or negligence on the part of any agent or attorney appointed by it
with due care hereunder; and
(h) if any property other than cash shall at any time be subject to a Lien in favor of the
Holders, the Trustee, if and to the extent authorized by a receivership or bankruptcy court of
competent jurisdiction or by the supplemental instrument subjecting such property to such Lien,
shall be entitled to make advances for the purpose of preserving such property or of discharging
tax Liens or other prior Liens or encumbrances thereon.
Section 7.03 Trustee Not Liable for Recitals in Indenture or in Debt Securities. The
recitals contained herein, in the Debt Securities (except the Trustees certificate of
authentication) shall be taken as the statements of the Issuers, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Debt Securities of any series, except that the
Trustee represents that it is duly authorized to execute and deliver this Indenture, authenticate
the Debt Securities and perform its obligations hereunder, and that the statements made by it or to
be made by it in a Statement of Eligibility and Qualification on Form T-1 supplied to the Issuers
are true and accurate. The Trustee shall not be accountable for the use or application by the
Issuers of any of the Debt Securities or of the proceeds thereof.
Section 7.04 Trustee, Paying Agent or Registrar May Own Debt Securities. The Trustee
or any paying agent or Registrar, in its individual or any other capacity, may become the owner or
pledgee of Debt Securities and subject to the provisions of the TIA relating to conflicts of
interest and preferential claims may otherwise deal with the Issuers with the same rights it would
have if it were not Trustee, paying agent or Registrar.
Section 7.05 Moneys Received by Trustee to Be Held in Trust. Subject to the
provisions of Section 11.05, all moneys received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any moneys received by it hereunder. So long as no Event of Default
shall have occurred and be continuing, all interest allowed on any such moneys shall be paid from
time to time to the Issuers upon an Issuer Order.
Section 7.06 Compensation and Reimbursement. The Issuers covenant and agree to pay in
Dollars to the Trustee from time to time, and the Trustee shall be entitled to, reasonable
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compensation for all services rendered by it hereunder (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust), and, except as
otherwise expressly provided herein, the Issuers will pay or reimburse in Dollars the Trustee upon
its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Indenture (including the reasonable compensation
and the expenses and disbursements of its agents, attorneys and counsel and of all Persons not
regularly in its employ), including without limitation, Section 6.02, except any such expense,
disbursement or advances as may arise from its negligence, willful misconduct or bad faith. The
Issuers also covenant to indemnify in Dollars the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence, willful misconduct or bad faith on the part
of the Trustee, arising out of or in connection with the acceptance or administration of this trust
or trusts hereunder, including the reasonable costs and expenses of defending itself against any
claim of liability in connection with the exercise or performance of any of its powers or duties
hereunder. The obligations of the Issuers under this Section 7.06 to compensate and indemnify the
Trustee and to pay or reimburse the Trustee for expenses, disbursements and advances shall
constitute additional Debt hereunder and shall survive the satisfaction and discharge of this
Indenture. The Issuers and the Holders agree that such additional Debt shall be secured by a Lien
prior to that of the Debt Securities upon all property and funds held or collected by the Trustee,
as such, except funds held in trust for the payment of principal of, and premium, if any, or
interest on, particular Debt Securities.
When the Trustee incurs expenses or renders services after an Event of Default specified in
Section 6.01(e) or (f) occurs, the expenses and the compensation for the services are intended to
constitute expenses of administration under any Bankruptcy Law.
Section 7.07 Right of Trustee to Rely on an Officers Certificate Where No Other Evidence
Specifically Prescribed. Except as otherwise provided in Section 7.01, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it necessary or desirable
that a matter be proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed)
may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers Certificate delivered to the Trustee and such
certificate, in the absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the provisions of this
Indenture upon the faith thereof.
Section 7.08 Separate Trustee; Replacement of Trustee. The Issuers may, but need not,
appoint a separate Trustee for any one or more series of Debt Securities. The Trustee may resign
with respect to one or more or all series of Debt Securities at any time by giving notice to the
Issuers. The Holders of a majority in principal amount of the Debt Securities of a particular
series may remove the Trustee for such series and only such series by so notifying the Trustee and
may appoint a successor Trustee. The Issuers shall remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged bankrupt or insolvent;
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(c) a Custodian takes charge of the Trustee or its property; or
(d) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Issuers or by the Holders of a majority in principal
amount of the Debt Securities of a particular series and such Holders do not reasonably promptly
appoint a successor Trustee, or if a vacancy exists in the office of Trustee for any reason (the
Trustee in such event being referred to herein as the retiring Trustee), the Issuers shall promptly
appoint a successor Trustee. No resignation or removal of the Trustee and no appointment of a
successor Trustee shall become effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of this Section 7.08.
A successor Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Issuers. Thereupon the resignation or removal of the retiring Trustee shall
become effective, and the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to
Holders of Debt Securities of each applicable series. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, subject to the Lien provided for in
Section 7.06.
If a successor Trustee does not take office within 60 days after the retiring Trustee gives
notice of resignation or is removed, the retiring Trustee or the Holders of 25% in principal amount
of the Debt Securities of any applicable series may petition any court of competent jurisdiction
for the appointment of a successor Trustee for the Debt Securities of such series.
If the Trustee fails to comply with Section 7.10, any Holder of Debt Securities of any
applicable series may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee for the Debt Securities of such series.
Notwithstanding the replacement of the Trustee pursuant to this Section 7.08, the Issuers
obligations under Section 7.06 shall continue for the benefit of the retiring Trustee.
In the case of the appointment hereunder of a separate or successor Trustee with respect to
the Debt Securities of one or more series, the Issuers, any retiring Trustee and each successor or
separate Trustee with respect to the Debt Securities of any applicable series shall execute and
deliver an Indenture supplemental hereto (i) which shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties of any retiring
Trustee with respect to the Debt Securities of any series as to which any such retiring Trustee is
not retiring shall continue to be vested in such retiring Trustee and (ii) that shall add to or
change any of the provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one trustee, it being understood that
nothing herein or in such supplemental Indenture shall constitute such Trustees co-trustees of the
same trust and that each such separate, retiring or successor Trustee shall be Trustee of a trust
or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other
such Trustee.
Section 7.09 Successor Trustee by Merger. If the Trustee consolidates with, merges or
converts into, or transfers all or substantially all its corporate trust business or assets to,
another
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corporation or banking association, the resulting, surviving or transferee corporation or
banking association without any further act shall be the successor Trustee.
In case at the time such successor or successors to the Trustee by merger, conversion,
consolidation or transfer shall succeed to the trusts created by this Indenture any of the Debt
Securities shall have been authenticated but not delivered, any such successor to the Trustee may
adopt the certificate of authentication of any predecessor Trustee, and deliver such Debt
Securities so authenticated; and in case at that time any of the Debt Securities shall not have
been authenticated, any successor to the Trustee may authenticate such Debt Securities either in
the name of any predecessor hereunder or in the name of the successor to the Trustee; and in all
such cases such certificates shall have the full force which it is anywhere in the Debt Securities
or in this Indenture provided that the certificate of the Trustee shall have.
Section 7.10 Eligibility; Disqualification. The Trustee shall at all times satisfy
the requirements of Section 310(a) of the TIA. The Trustee shall have a combined capital and
surplus of at least $50,000,000 as set forth in its most recent published annual report of
condition. No obligor upon the Debt Securities of a particular series or Person directly or
indirectly controlling, controlled by or under common control with such obligor shall serve as
Trustee for the Debt Securities of such series. The Trustee shall comply with Section 310(b) of
the TIA; provided, however, that there shall be excluded from the operation of Section 310(b)(1) of
the TIA this Indenture or any indenture or indentures under which other securities or certificates
of interest or participation in other securities of the Issuers are outstanding if the requirements
for such exclusion set forth in Section 310(b)(1) of the TIA are met.
Section 7.11 Preferential Collection of Claims Against Issuers. The Trustee shall
comply with Section 311(a) of the TIA, excluding any creditor relationship listed in Section 311(b)
of the TIA. A Trustee who has resigned or been removed shall be subject to Section 311(a) of the
TIA to the extent indicated therein.
Section 7.12 Compliance with Tax Laws. The Trustee hereby agrees to comply with all
U.S. Federal income tax information reporting and withholding requirements applicable to it with
respect to payments of premium (if any) and interest on the Debt Securities, whether acting as
Trustee, Registrar, paying agent or otherwise with respect to the Debt Securities.
ARTICLE VIII
CONCERNING THE HOLDERS
Section 8.01 Evidence of Action by Holders. Whenever in this Indenture it is provided
that the Holders of a specified percentage in aggregate principal amount of the Debt Securities of
any or all series may take action (including the making of any demand or request, the giving of any
direction, notice, consent or waiver or the taking of any other action) the fact that at the time
of taking any such action the Holders of such specified percentage have joined therein may be
evidenced (a) by any instrument or any number of instruments of similar tenor executed by Holders
in Person or by agent or proxy appointed in writing, (b) by the record of the Holders voting in
favor thereof at any meeting of Holders duly called and held in accordance with the provisions of
Section 5.02, (c) by a combination of such instrument or instruments and any such record of such a
meeting of Holders or (d) in the case of Debt Securities evidenced by a Global
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Security, by any electronic transmission or other message, whether or not in written format,
that complies with the Depositarys applicable procedures.
Section 8.02 Proof of Execution of Instruments and of Holding of Debt Securities.
Subject to the provisions of Sections 7.01, 7.02 and 13.09, proof of the execution of any
instrument by a Holder or his agent or proxy shall be sufficient if made in accordance with such
reasonable rules and regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee. The ownership of Debt Securities of any series shall be proved by the
Debt Security Register or by a certificate of the Registrar for such series. The Trustee may
require such additional proof of any matter referred to in this Section 8.02 as it shall deem
necessary.
Section 8.03 Who May Be Deemed Owner of Debt Securities. Prior to due presentment for
registration of transfer of any Debt Security, the Issuers, the Subsidiary Guarantors, the Trustee,
any paying agent and any Registrar may deem and treat the Person in whose name any Debt Security
shall be registered upon the books of the Issuers as the absolute owner of such Debt Security
(whether or not such Debt Security shall be overdue and notwithstanding any notation of ownership
or other writing thereon) for the purpose of receiving payment of or on account of the principal of
and premium, if any, and (subject to Section 2.12) interest on such Debt Security and for all other
purposes, and none of the Issuers, the Subsidiary Guarantors or the Trustee nor any paying agent
nor any Registrar shall be affected by any notice to the contrary; and all such payments so made to
any such Holder for the time being, or upon his order, shall be valid and, to the extent of the sum
or sums so paid, effectual to satisfy and discharge the liability for moneys payable upon any such
Debt Security.
None of the Issuers, the Subsidiary Guarantors, the Trustee, any paying agent or any Registrar
will have any responsibility or liability for any aspect of the records relating to or payments
made on account of beneficial ownership interests in a Global Security or for maintaining,
supervising or reviewing any records relating to such beneficial ownership interests.
Section 8.04 Instruments Executed by Holders Bind Future Holders. At any time prior
to (but not after) the evidencing to the Trustee, as provided in Section 8.01, of the taking of any
action by the Holders of the percentage in aggregate principal amount of the Debt Securities of any
series specified in this Indenture in connection with such action and subject to the following
paragraph, any Holder of a Debt Security which is shown by the evidence to be included in the Debt
Securities the Holders of which have consented to such action may, by filing written notice with
the Trustee at its corporate trust office and upon proof of holding as provided in Section 8.02,
revoke such action so far as concerns such Debt Security. Except as aforesaid any such action
taken by the Holder of any Debt Security shall be conclusive and binding upon such Holder and upon
all future Holders and owners of such Debt Security and of any Debt Security issued upon transfer
thereof or in exchange or substitution therefor, irrespective of whether or not any notation in
regard thereto is made upon such Debt Security or such other Debt Securities. Any action taken by
the Holders of the percentage in aggregate principal amount of the Debt Securities of any series
specified in this Indenture in connection with such action shall be conclusively binding upon the
Issuers, the Subsidiary Guarantors, the Trustee and the Holders of all the Debt Securities of such
series.
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The Issuers may, but shall not be obligated to, fix a record date for the purpose of
determining the Holders of Debt Securities entitled to give their consent or take any other action
required or permitted to be taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were Holders of Debt
Securities at such record date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to take any such action,
whether or not such Persons continue to be Holders of Debt Securities after such record date. No
such consent shall be valid or effective for more than 120 days after such record date unless the
consent of the Holders of the percentage in aggregate principal amount of the Debt Securities of
such series specified in this Indenture shall have been received within such 120-day period.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01 Purposes for Which Supplemental Indenture May Be Entered into Without Consent
of Holders. The Issuers and any Subsidiary Guarantors, when authorized by resolutions of each
Issuers Board of Directors, and the Trustee may from time to time and at any time, without the
consent of Holders, enter into an Indenture or Indentures supplemental hereto (which shall conform
to the provisions of the TIA as in force at the date of the execution thereof) for one or more of
the following purposes:
(a) to evidence the succession pursuant to Article X of another Person to either of the
Issuers, or successive successions, and the assumption by the Successor Company (as defined in
Section 10.01) of the covenants, agreements and obligations of its predecessor Issuer in this
Indenture and in the Debt Securities;
(b) to surrender any right or power herein conferred upon the Issuers or the Subsidiary
Guarantors, to add to the covenants of the Issuers or the Subsidiary Guarantors such further
covenants, restrictions, conditions or provisions for the protection of the Holders of all or any
series of Debt Securities (and if such covenants are to be for the benefit of less than all series
of Debt Securities, stating that such covenants are expressly being included solely for the benefit
of such series) as the Board of Directors shall consider to be for the protection of the Holders of
such Debt Securities, and to make the occurrence, or the occurrence and continuance, of a Default
in any of such additional covenants, restrictions, conditions or provisions a Default or an Event
of Default permitting the enforcement of all or any of the several remedies provided in this
Indenture; provided, that in respect of any such additional covenant, restriction, condition or
provision such supplemental Indenture may provide for a particular period of grace after Default
(which period may be shorter or longer than that allowed in the case of other Defaults) or may
provide for an immediate enforcement upon such Default or may limit the remedies available to the
Trustee upon such Default or may limit the right of the Holders of a majority in aggregate
principal amount of any or all series of Debt Securities to waive such Default;
(c) to cure any ambiguity or omission or to correct or supplement any provision contained
herein, in any supplemental Indenture or in any Debt Securities of any series that may be defective
or inconsistent with any other provision contained herein, in any supplemental Indenture or in the
Debt Securities of such series; to convey, transfer, assign, mortgage or pledge
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any property to or with the Trustee, or to make such other provisions in regard to matters or
questions arising under this Indenture as shall not adversely affect the interests of any Holders
of Debt Securities of any series;
(d) to permit the qualification of this Indenture or any Indenture supplemental hereto under
the TIA as then in effect, except that nothing herein contained shall permit or authorize the
inclusion in any Indenture supplemental hereto of the provisions referred to in Section 316(a)(2)
of the TIA;
(e) to permit or facilitate the issuance of Debt Securities of any series in uncertificated
form;
(f) to reflect the release of any Subsidiary Guarantor in accordance with Article XIV
(g) to add Subsidiary Guarantors with respect to any or all of the Debt Securities or to
secure any or all of the Debt Securities or the Guarantee;
(h) to make any change that does not adversely affect the rights hereunder of any Holder;
(i) to add to, change or eliminate any of the provisions of this Indenture in respect of one
or more series of Debt Securities; provided, however, that any such addition, change or elimination
not otherwise permitted under this Section 9.01 shall neither apply to any Debt Security of any
series created prior to the execution of such supplemental Indenture and entitled to the benefit of
such provision nor modify the rights of the Holder of any such Debt Security with respect to such
provision or shall become effective only when there is no such Debt Security Outstanding;
(j) to evidence and provide for the acceptance of appointment hereunder by a successor or
separate Trustee with respect to the Debt Securities of one or more series and to add to or change
any of the provisions of this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee; and
(k) to establish the form or terms of Debt Securities of any series as permitted by Sections
2.01 and 2.03.
The Trustee is hereby authorized to join with the Issuers and the Subsidiary Guarantors in the
execution of any such supplemental Indenture, to make any further appropriate agreements and
stipulations which may be therein contained and to accept the conveyance, transfer, assignment,
mortgage or pledge of any property thereunder, but the Trustee shall not be obligated to enter into
any such supplemental Indenture which affects the Trustees own rights, duties or immunities under
this Indenture or otherwise.
Any supplemental Indenture authorized by the provisions of this Section 9.01 may be executed
by the Issuers, the Subsidiary Guarantors and the Trustee without the consent of the Holders of any
of the Debt Securities at the time Outstanding, notwithstanding any of the provisions of Section
9.02.
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Section 9.02 Modification of Indenture with Consent of Holders of Debt Securities.
Without notice to any Holder but with the consent (evidenced as provided in Section 8.01) of the
Holders of not less than a majority in aggregate principal amount of the Outstanding Debt
Securities of each series affected by such supplemental Indenture (including consents obtained in
connection with a tender offer or exchange offer for any such series of Debt Securities), the
Issuers and the Subsidiary Guarantors, when authorized by resolutions of each Issuers Board of
Directors, and the Trustee may from time to time and at any time enter into an Indenture or
Indentures supplemental hereto (which shall conform to the provisions of the TIA as in force at the
date of execution thereof) for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of any supplemental Indenture or of
modifying in any manner the rights of the Holders of the Debt Securities of such series; provided,
that no such supplemental Indenture, without the consent of the Holders of each Debt Security so
affected, shall: reduce the percentage in principal amount of Debt Securities of any series whose
Holders must consent to an amendment; reduce the rate of or extend the time for payment of interest
on any Debt Security; reduce the principal of or extend the Stated Maturity of any Debt Security;
reduce any premium payable upon the redemption of any Debt Security or change the time at which any
Debt Security may or shall be redeemed in accordance with Article III; make any Debt Security
payable in currency other than the Dollar; impair the right of any Holder to receive payment of
premium, if any, principal of and interest on such Holders Debt Securities on or after the due
dates therefor or to institute suit for the enforcement of any payment on or with respect to such
Holders Debt Securities; release any security that may have been granted in respect of the Debt
Securities, other than in accordance with this Indenture; make any change in Section 6.06 or this
Section 9.02; or, except as provided in Section 11.02(b) or Section14.04, release the Subsidiary
Guarantors other than as provided in this Indenture or modify the Guarantee in any manner adverse
to the Holders.
A supplemental Indenture which changes or eliminates any covenant or other provision of this
Indenture which has been expressly included solely for the benefit of one or more particular series
of Debt Securities or which modifies the rights of the Holders of Debt Securities of such series
with respect to such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Debt Securities of any other series.
Upon the request of the Issuers, accompanied by a copy of resolutions of the Board of
Directors of each Issuer authorizing the execution of any such supplemental Indenture, and upon the
filing with the Trustee of evidence of the consent of Holders as aforesaid, the Trustee shall join
with the Issuers and the Subsidiary Guarantors in the execution of such supplemental Indenture
unless such supplemental Indenture affects the Trustees own rights, duties or immunities under
this Indenture or otherwise, in which case the Trustee may in its discretion but shall not be
obligated to enter into such supplemental Indenture.
It shall not be necessary for the consent of the Holders under this Section 9.02 to approve
the particular form of any proposed supplemental Indenture, but it shall be sufficient if such
consent shall approve the substance thereof.
After an amendment under this Section 9.02 requiring the consent of the Holders of any series
of Debt Securities becomes effective, the Issuers shall mail to Holders of that series of Debt
Securities of each series affected thereby a notice briefly describing such amendment. The
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failure to give such notice to any such Holders, or any defect therein, shall not impair or
affect the validity of an amendment under this Section 9.02 with respect to other Holders.
Section 9.03 Effect of Supplemental Indentures. Upon the execution of any
supplemental Indenture pursuant to the provisions of this Article IX, this Indenture shall be and
be deemed to be modified and amended in accordance therewith and the respective rights, limitations
of rights, obligations, duties and immunities under this Indenture of the Trustee, the Issuers, the
Subsidiary Guarantors and the Holders shall thereafter be determined, exercised and enforced
hereunder subject in all respects to such modifications and amendments, and all the terms and
conditions of any such supplemental Indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
The Trustee, subject to the provisions of Sections 7.01 and 7.02, may receive an Officers
Certificate and an Opinion of Counsel as conclusive evidence that any such supplemental Indenture
complies with the provisions of this Article IX.
Section 9.04 Debt Securities May Bear Notation of Changes by Supplemental Indentures.
Debt Securities of any series authenticated and delivered after the execution of any supplemental
Indenture pursuant to the provisions of this Article IX may, and shall if required by the Trustee,
bear a notation in form approved by the Trustee as to any matter provided for in such supplemental
Indenture. New Debt Securities of any series so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any modification of this Indenture contained in any such
supplemental Indenture may be prepared and executed by the Issuers, authenticated by the Trustee
and delivered in exchange for the Debt Securities of such series then Outstanding. Failure to make
the appropriate notation or to issue a new Debt Security of such series shall not affect the
validity of such amendment.
ARTICLE X
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 10.01 Consolidations and Mergers of the Issuers. Neither of the Issuers may
consolidate or amalgamate with or merge with or into any Person, or sell, convey, transfer, lease
or otherwise dispose of all or substantially all its assets to any Person, whether in a single
transaction or a series of related transactions, unless: (a) either (i) such Issuer shall be the
surviving Person in the case of a merger or (ii) the resulting, surviving or transferee Person if
other than such Issuer (the Successor Company), shall be a partnership, limited liability company
or corporation organized and existing under the laws of the United States, any State thereof or the
District of Columbia and the Successor Company shall expressly assume, by an Indenture supplemental
hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of such Issuer under this Indenture and the Debt Securities according to their tenor;
(b) immediately after giving effect to such transaction or series of transactions (and treating any
Debt which becomes an obligation of the Successor Company or any Subsidiary of such Issuer as a
result of such transaction as having been incurred by the Successor Company or such Subsidiary at
the time of such transaction or series of transactions), no Default or Event of Default would occur
or be continuing; (c) if such Issuer is not the continuing Person, then each Subsidiary Guarantor,
unless it has become the Successor Company, shall confirm that its Guarantee shall continue to
apply to the obligations under the Debt Securities and this
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Indenture; and (d) the Issuers shall have delivered to the Trustee an Officers Certificate
and an Opinion of Counsel, each stating that such consolidation, amalgamation, merger or
disposition and such supplemental Indenture (if any) comply with this Indenture.
Section 10.02 Rights and Duties of Successor Company. In case of any consolidation,
amalgamation or merger where such Issuer is not the continuing Person, or disposition of all or
substantially all of the assets of such Issuer in accordance with Section 10.01, the Successor
Company shall succeed to and be substituted for such Issuer with the same effect as if it had been
named herein as the respective party to this Indenture, and the predecessor entity shall be
released from all liabilities and obligations under this Indenture and the Debt Securities, except
that no such release will occur in the case of a lease of all or substantially all of such Issuers
assets. The Successor Company thereupon may cause to be signed, and may issue either in its own
name or in the name of such Issuer, any or all the Debt Securities issuable hereunder which
theretofore shall not have been signed by or on behalf of such Issuer and delivered to the
Trustee; and, upon the order of the Successor Company, instead of such Issuer, and subject to all
the terms, conditions and limitations in this Indenture prescribed, the Trustee shall authenticate
and shall deliver any Debt Securities which previously shall have been signed and delivered by or
on behalf of such Issuer to the Trustee for authentication, and any Debt Securities which the
Successor Company thereafter shall cause to be signed and delivered to the Trustee for that
purpose. All the Debt Securities so issued shall in all respects have the same legal rank and
benefit under this Indenture as the Debt Securities theretofore or thereafter issued in accordance
with the terms of this Indenture as though all such Debt Securities had been issued at the date of
the execution hereof.
In case of any such consolidation, amalgamation, merger, sale or disposition such changes in
phraseology and form (but not in substance) may be made in the Debt Securities thereafter to be
issued as may be appropriate.
ARTICLE XI
SATISFACTION AND DISCHARGE OF
INDENTURE; DEFEASANCE; UNCLAIMED MONEYS
Section 11.01 Applicability of Article. The provisions of this Article XI relating to
discharge or defeasance of Debt Securities shall be applicable to each series of Debt Securities
except as otherwise specified pursuant to Section 2.03 for Debt Securities of such series.
Section 11.02 Satisfaction and Discharge of Indenture; Defeasance.
(a) If at any time the Issuers shall have delivered to the Trustee for cancellation all Debt
Securities of any series theretofore authenticated and delivered (other than any Debt Securities of
such series which shall have been destroyed, lost or stolen and which shall have been replaced or
paid as provided in Section 2.09 and Debt Securities for whose payment money has theretofore been
deposited in trust and thereafter repaid to the Issuers as provided in Section 11.05) or all Debt
Securities of such series not theretofore delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within one year or are to
be called for redemption within one year under arrangements satisfactory to the Trustee for the
giving of notice of redemption, and the Issuers shall deposit
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with the Trustee as trust funds the entire amount in cash sufficient to pay at final maturity
or upon redemption all Debt Securities of such series not theretofore delivered to the Trustee for
cancellation, including principal and premium, if any, and interest due or to become due on such
date of maturity or Redemption Date, as the case may be, and if in either case the Issuers shall
also pay or cause to be paid all other sums payable hereunder by the Issuers, then this Indenture
shall cease to be of further effect (except as to any surviving rights of registration of transfer
or exchange of such Debt Securities herein expressly provided for) with respect to the Debt
Securities of such series, and the Trustee, on demand of the Issuers accompanied by an Officers
Certificate and an Opinion of Counsel and at the cost and expense of the Issuers, shall execute
proper instruments acknowledging satisfaction of and discharging this Indenture with respect to the
Debt Securities of such series.
(b) Subject to Sections 11.02(c), 11.03 and 11.07, the Issuers at any time may terminate, with
respect to Debt Securities of a particular series, all its obligations under the Debt Securities
of such series and this Indenture with respect to the Debt Securities of such series (legal
defeasance option) or the operation of (w) Sections 4.09 and 4.10, (x) any covenant made
applicable to such Debt Securities pursuant to Section 2.03, (y) Sections 6.01(d), (g) and (h) and
(z) as they relate to the Subsidiary Guarantors only, Sections 6.01(e) and (f) (covenant
defeasance option). If the Issuers exercise either their legal defeasance option or their
covenant defeasance option with respect to Debt Securities of a particular series that are entitled
to the benefit of the Guarantee, the Guarantee will terminate with respect to that series of Debt
Securities. The Issuers may exercise their legal defeasance option notwithstanding its prior
exercise of its covenant defeasance option.
If the Issuers exercise their legal defeasance option, payment of the Debt Securities of the
defeased series may not be accelerated because of an Event of Default. If the Issuers exercise
their covenant defeasance option, payment of the Debt Securities of the defeased series may not be
accelerated because of an Event of Default specified in Sections 6.01(d), (g) and (h) and, with
respect to the Subsidiary Guarantors only, Sections 6.01(e) and (f).
Upon satisfaction of the conditions set forth herein and upon request of the Issuers, the
Trustee shall acknowledge in writing the discharge of those obligations that the Issuers terminate.
(c) Notwithstanding clauses (a) and (b) above, the Issuers obligations in Sections 2.07,
2.09, 4.02, 4.03, 4.04, the last sentence of 4.05(a), 4.06(a), 5.01, 7.06, 11.05, 11.06 and 11.07
shall survive until the Debt Securities of the defeased series have been paid in full. Thereafter,
the Issuers obligations in Sections 7.06, 11.05 and 11.06 shall survive.
Section 11.03 Conditions of Defeasance. The Issuers may exercise their legal
defeasance option or its covenant defeasance option with respect to Debt Securities of a particular
series only if:
(a) the Issuers irrevocably deposit in trust with the Trustee money or U.S. Government
Obligations for the payment of principal of, and premium, if any, and interest on, the Debt
Securities of such series to final maturity or redemption, as the case may be;
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(b) the Issuers deliver to the Trustee a certificate from a nationally recognized firm of
independent accountants expressing their opinion that the payments of principal and interest when
due and without reinvestment on the deposited U.S. Government Obligations plus any deposited money
without investment will provide cash at such times and in such amounts as will be sufficient to pay
the principal, premium, if any, and interest when due on all the Debt Securities of such series to
final maturity or redemption, as the case may be;
(c) 91 days pass after the deposit is made and during the 91-day period no Default specified
in Section 6.01(e) or (f) with respect to the Issuers occurs which is continuing at the end of the
period;
(d) no Default has occurred and is continuing on the date of such deposit and after giving
effect thereto;
(e) the deposit does not constitute a default under any other agreement binding on the
Issuers;
(f) the Issuers deliver to the Trustee an Opinion of Counsel to the effect that the trust
resulting from the deposit does not constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940;
(g) in the event of the legal defeasance option, the Issuers shall have delivered to the
Trustee an Opinion of Counsel stating that the Issuers have received from the Internal Revenue
Service a ruling, or since the date of this Indenture there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders of Debt Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of such defeasance and will be
subject to Federal income tax on the same amounts, in the same manner and at the same times as
would have been the case if such defeasance had not occurred;
(h) in the event of the covenant defeasance option, the Issuers shall have delivered to the
Trustee an Opinion of Counsel to the effect that the Holders of Debt Securities of such series will
not recognize income, gain or loss for Federal income tax purposes as a result of such covenant
defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such covenant defeasance had not occurred; and
(i) the Issuers deliver to the Trustee an Officers Certificate and an Opinion of Counsel,
each stating that all conditions precedent to the defeasance and discharge of the Debt Securities
of such series as contemplated by this Article XI have been complied with.
Before or after a deposit, the Issuers may make arrangements satisfactory to the Trustee for
the redemption of Debt Securities of such series at a future date in accordance with Article III.
Section 11.04 Application of Trust Money. The Trustee shall hold in trust money or
U.S. Government Obligations deposited with it pursuant to this Article XI. It shall apply the
deposited money and the money from U.S. Government Obligations through any paying agent
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and in accordance with this Indenture to the payment of principal of, and premium, if any, and
interest on, the Debt Securities of the defeased series.
Section 11.05 Repayment to Issuers. The Trustee and any paying agent shall promptly
turn over to the Issuers upon request any excess money or securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and any paying agent shall pay
to the Issuers upon request any money held by them for the payment of principal, premium or
interest that remains unclaimed for two years, and, thereafter, Holders entitled to such money must
look to the Issuers for payment as general creditors.
Section 11.06 Indemnity for U.S. Government Obligations. The Issuers shall pay and
shall indemnify the Trustee and the Holders against any tax, fee or other charge imposed on or
assessed against deposited U.S. Government Obligations or the principal and interest received on
such U.S. Government Obligations.
Section 11.07 Reinstatement. If the Trustee or any paying agent is unable to apply
any money or U.S. Government Obligations in accordance with this Article XI by reason of any legal
proceeding or by reason of any order or judgment of any court or government authority enjoining,
restraining or otherwise prohibiting such application, the Issuers obligations under this
Indenture and the Debt Securities of the defeased series shall be revived and reinstated as though
no deposit had occurred pursuant to this Article XI until such time as the Trustee or any paying
agent is permitted to apply all such money or U.S. Government Obligations in accordance with this
Article XI.
ARTICLE XII
[RESERVED]
This Article XII has been intentionally omitted.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 13.01 Successors and Assigns of Issuers Bound by Indenture. All the
covenants, stipulations, promises and agreements in this Indenture contained by or in behalf of the
Issuers, the Subsidiary Guarantors or the Trustee shall bind their respective successors and
assigns, whether so expressed or not.
Section 13.02 Acts of Board, Committee or Officer of Successor Issuer Valid. Any act
or proceeding by any provision of this Indenture authorized or required to be done or performed by
any board, committee or officer of either of the Issuers shall and may be done and performed with
like force and effect by the like board, committee or officer of any Successor Company.
Section 13.03 Required Notices or Demands. Any notice or communication by the
Issuers, the Subsidiary Guarantors or the Trustee to the others is duly given if in writing in the
English language and delivered in Person or mailed by registered or certified mail (return receipt
requested), telecopier or overnight air courier guaranteeing next day delivery, to the others
address:
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If to the Issuers or any Subsidiary Guarantor:
Targa Resources Partners LP
1000 Louisiana, Suite 4300
Houston, Texas 77002
Attention: General Counsel
Telecopy No. (713) -
If to the Trustee:
[ ]
The Issuers, any Subsidiary Guarantor or the Trustee by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications shall be deemed to have been duly given: at the time delivered
by hand, if personally delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; on the first Business Day on or after being sent, if telecopied and the sender
receives confirmation of successful transmission; and the next Business Day after timely delivery
to the courier, if sent by overnight air courier guaranteeing next day delivery.
Any notice required or permitted to a Holder by the Issuers, any Subsidiary Guarantor or the
Trustee pursuant to the provisions of this Indenture shall be deemed to be properly mailed by being
deposited postage prepaid in a post office letter box in the United States addressed to such Holder
at the address of such Holder as shown on the Debt Security Register. Any report pursuant to
Section 313 of the TIA shall be transmitted in compliance with subsection (c) therein.
Notwithstanding the foregoing, any notice to Holders of Floating Rate Securities regarding the
determination of a periodic rate of interest, if such notice is required pursuant to Section 2.03,
shall be sufficiently given if given in the manner specified pursuant to Section 2.03.
In the event of suspension of regular mail service or by reason of any other cause it shall be
impracticable to give notice by mail, then such notification as shall be given with the approval of
the Trustee shall constitute sufficient notice for every purpose hereunder.
In the event it shall be impracticable to give notice by publication, then such notification
as shall be given with the approval of the Trustee shall constitute sufficient notice for every
purpose hereunder.
Failure to mail a notice or communication to a Holder or any defect in it or any defect in any
notice by publication as to a Holder shall not affect the sufficiency of such notice with respect
to other Holders. If a notice or communication is mailed or published in the manner provided
above, it is conclusively presumed duly given.
Section 13.04 Indenture and Debt Securities to Be Construed in Accordance with the Laws of
the State of New York. THIS INDENTURE, EACH DEBT SECURITY AND THE
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GUARANTEE SHALL BE DEEMED TO BE NEW YORK CONTRACTS, AND FOR ALL PURPOSES SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE.
Section 13.05 Officers Certificate and Opinion of Counsel to Be Furnished upon
Application or Demand by the Issuers. Upon any application or demand by the Issuers to the
Trustee to take any action under any of the provisions of this Indenture, each of the Issuers shall
furnish to the Trustee an Officers Certificate stating that all conditions precedent provided for
in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel
stating that, in the opinion of such counsel, all such conditions precedent have been complied
with, except that in the case of any such application or demand as to which the furnishing of such
document is specifically required by any provision of this Indenture relating to such particular
application or demand, no additional certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and delivered to the Trustee with
respect to compliance with a condition or covenant provided for in this Indenture shall include (a)
a statement that the Person making such certificate or opinion has read such covenant or condition,
(b) a brief statement as to the nature and scope of the examination or investigation upon which the
statements or opinions contained in such certificate or opinion are based, (c) a statement that, in
the opinion of such Person, he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant or condition has been
complied with and (d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been complied with.
Section 13.06 Payments Due on Legal Holidays. In any case where the date of maturity
of interest on or principal of and premium, if any, on the Debt Securities of a series or the date
fixed for redemption or repayment of any Debt Security or the making of any sinking fund payment
shall not be a Business Day at any Place of Payment for the Debt Securities of such series, then
payment of interest or principal and premium, if any, or the making of such sinking fund payment
need not be made on such date at such Place of Payment, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall accrue for the period after such
date. If a record date is not a Business Day, the record date shall not be affected.
Section 13.07 Provisions Required by TIA to Control. If and to the extent that any
provision of this Indenture limits, qualifies or conflicts with another provision included in this
Indenture which is required to be included in this Indenture by any of Sections 310 to 318,
inclusive, of the TIA, such required provision shall control.
Section 13.08 Computation of Interest on Debt Securities. Interest, if any, on the
Debt Securities shall be computed on the basis of a 360-day year of twelve 30-day months, except as
may otherwise be provided pursuant to Section 2.03.
Section 13.09 Rules by Trustee, Paying Agent and Registrar. The Trustee may make
reasonable rules for action by or a meeting of Holders. The Registrar and any paying agent may
make reasonable rules for their functions.
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Section 13.10 No Recourse Against Others. The General Partner and its directors,
officers, employees and members, as such, shall have no liability for any obligations of the
Subsidiary Guarantors or the Issuers under the Debt Securities, this Indenture or the Guarantee or
for any claim based on, in respect of, or by reason of, such obligations or their creation. By
accepting a Debt Security, each Holder shall be deemed to have waived and released all such
liability. The waiver and release shall be part of the consideration for the issue of the Debt
Securities.
Section 13.11 Severability. In case any provision in this Indenture or the Debt
Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 13.12 Effect of Headings. The article and section headings herein and in the
Table of Contents are for convenience only and shall not affect the construction hereof.
Section 13.13 Indenture May Be Executed in Counterparts. This Indenture may be
executed in any number of counterparts, each of which shall be an original; but such counterparts
shall together constitute but one and the same instrument.
ARTICLE XIV
GUARANTEE
Section 14.01 Unconditional Guarantee.
(a) Notwithstanding any provision of this Article XIV to the contrary, the provisions of this
Article XIV shall be applicable only to, and inure solely to the benefit of, the Debt Securities of
any series designated, pursuant to Section 2.03, as entitled to the benefits of the Guarantee of
each of the Subsidiary Guarantors.
(b) For value received, each of the Subsidiary Guarantors hereby fully, unconditionally and
absolutely guarantees (the Guarantee) to the Holders and to the Trustee the due and punctual
payment of the principal of, and premium, if any, and interest on the Debt Securities and all other
amounts due and payable under this Indenture and the Debt Securities by the Issuers, when and as
such principal, premium, if any, and interest shall become due and payable, whether at the Stated
Maturity or by declaration of acceleration, call for redemption or otherwise, according to the
terms of the Debt Securities and this Indenture, subject to the limitations set forth in Section
14.03.
(c) Failing payment when due of any amount guaranteed pursuant to the Guarantee, for whatever
reason, each of the Subsidiary Guarantors will be jointly and severally obligated to pay the same
immediately. The Guarantee hereunder is intended to be a general, unsecured, senior obligation of
each of the Subsidiary Guarantors and will rank pari passu in right of payment with all Debt of
each Subsidiary Guarantor that is not, by its terms, expressly subordinated in right of payment to
the Guarantee. Each of the Subsidiary Guarantors hereby agrees that its obligations hereunder
shall be full, unconditional and absolute, irrespective of the validity, regularity or
enforceability of the Debt Securities, the Guarantee (including the Guarantee of any other
Subsidiary Guarantor) or this Indenture, the absence of any action to enforce the same, any waiver
or consent by any Holder of the Debt Securities with respect to any
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provisions hereof or thereof, the recovery of any judgment against either of the Issuers or
any other Subsidiary Guarantor, or any action to enforce the same or any other circumstances which
might otherwise constitute a legal or equitable discharge or defense of any of the Subsidiary
Guarantors. Each of the Subsidiary Guarantors hereby agrees that in the event of a default in
payment of the principal of, or premium, if any, or interest on the Debt Securities, whether at the
Stated Maturity or by declaration of acceleration, call for redemption or otherwise, legal
proceedings may be instituted by the Trustee on behalf of the Holders or, subject to Section 6.04,
by the Holders, on the terms and conditions set forth in this Indenture, directly against such
Subsidiary Guarantor to enforce the Guarantee without first proceeding against either of the
Issuers or any other Subsidiary Guarantor.
(d) The obligations of each of the Subsidiary Guarantors under this Article XIV shall be as
aforesaid full, unconditional and absolute and shall not be impaired, modified, released or limited
by any occurrence or condition whatsoever, including, without limitation, (A) any compromise,
settlement, release, waiver, renewal, extension, indulgence or modification of, or any change in,
any of the obligations and liabilities of any of the Issuers or the Subsidiary Guarantors contained
in the Debt Securities or this Indenture, (B) any impairment, modification, release or limitation
of the liability of any of the Issuers or the Subsidiary Guarantors or any of their estates in
bankruptcy, or any remedy for the enforcement thereof, resulting from the operation of any present
or future provision of any applicable Bankruptcy Law, as amended, or other statute or from the
decision of any court, (C) the assertion or exercise by any of the Issuers, the Subsidiary
Guarantors or the Trustee of any rights or remedies under the Debt Securities or this Indenture or
their delay in or failure to assert or exercise any such rights or remedies, (D) the assignment or
the purported assignment of any property as security for the Debt Securities, including all or any
part of the rights of any of the Issuers or the Subsidiary Guarantors under this Indenture, (E) the
extension of the time for payment by any of the Issuers or the Subsidiary Guarantors of any
payments or other sums or any part thereof owing or payable under any of the terms and provisions
of the Debt Securities or this Indenture or of the time for performance by any of the Issuers or
the Subsidiary Guarantors of any other obligations under or arising out of any such terms and
provisions or the extension or the renewal of any thereof, (F) the modification or amendment
(whether material or otherwise) of any duty, agreement or obligation of any of the Issuers or the
Subsidiary Guarantors set forth in this Indenture, (G) the voluntary or involuntary liquidation,
dissolution, sale or other disposition of all or substantially all of the assets, marshaling of
assets and liabilities, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of, or other similar proceeding
affecting, any of the Issuers or the Subsidiary Guarantors or any of their respective assets, or
the disaffirmance of the Debt Securities, the Guarantee or this Indenture in any such proceeding,
(H) the release or discharge of any of the Issuers or the Subsidiary Guarantors from the
performance or observance of any agreement, covenant, term or condition contained in any of such
instruments by operation of law, (I) the unenforceability of the Debt Securities, the Guarantee or
this Indenture or (J) any other circumstances (other than payment in full or discharge of all
amounts guaranteed pursuant to the Guarantee) which might otherwise constitute a legal or equitable
discharge of a surety or guarantor.
(e) Each of the Subsidiary Guarantors hereby (A) waives diligence, presentment, demand of
payment, filing of claims with a court in the event of the merger, insolvency or bankruptcy of any
of the Issuers or the Subsidiary Guarantors, and all demands whatsoever, (B)
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acknowledges that any agreement, instrument or document evidencing the Guarantee may be transferred
and that the benefit of its obligations hereunder shall extend to each holder of any agreement,
instrument or document evidencing the Guarantee without notice to it and (C) covenants that the
Guarantee will not be discharged except by complete performance of the Guarantee. Each of the
Subsidiary Guarantors further agrees that if at any time all or any part of any payment theretofore
applied by any Person to the Guarantee is, or must be, rescinded or returned for any reason
whatsoever, including without limitation, the insolvency, bankruptcy or reorganization of any of
the Issuers or the Subsidiary Guarantors, the Guarantee shall, to the extent that such payment is
or must be rescinded or returned, be deemed to have continued in existence notwithstanding such
application, and the Guarantee shall continue to be effective or be reinstated, as the case may be,
as though such application had not been made.
(f) Each of the Subsidiary Guarantors shall be subrogated to all rights of the Holders and the
Trustee against the Issuers in respect of any amounts paid by such Subsidiary Guarantor pursuant to
the provisions of this Indenture, provided, however, that such Subsidiary Guarantor, shall not be
entitled to enforce or to receive any payments arising out of, or based upon, such right of
subrogation until all of the Debt Securities and the Guarantee shall have been paid in full or
discharged.
Section 14.02 Execution and Delivery of Guarantee. To further evidence the Guarantee
set forth in Section 14.01, each of the Subsidiary Guarantors hereby agrees that a notation
relating to such Guarantee, substantially in the form attached hereto as Annex A, shall be endorsed
on each Debt Security entitled to the benefits of the Guarantee authenticated and delivered by the
Trustee and executed by either manual or facsimile signature of an Officer of such Subsidiary
Guarantor. Each of the Subsidiary Guarantors hereby agrees that the Guarantee set forth in Section
14.01 shall remain in full force and effect notwithstanding any failure to endorse on each Debt
Security a notation relating to the Guarantee. If any Officer of any Subsidiary Guarantor whose
signature is on this Indenture or a Debt Security no longer holds that office at the time the
Trustee authenticates such Debt Security or at any time thereafter, the Guarantee of such Debt
Security shall be valid nevertheless. The delivery of any Debt Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the Guarantee set forth in this
Indenture on behalf of the Subsidiary Guarantors.
The Trustee hereby accepts the trusts in this Indenture upon the terms and conditions herein
set forth.
Section 14.03 Limitation on Subsidiary Guarantors Liability. Each Subsidiary
Guarantor and by its acceptance hereof each Holder of a Debt Security entitled to the benefits of
the Guarantee hereby confirm that it is the intention of all such parties that the guarantee by
such Subsidiary Guarantor pursuant to the Guarantee not constitute a fraudulent transfer or
conveyance for purposes of any Federal or state law. To effectuate the foregoing intention, the
Holders of a Debt Security entitled to the benefits of the Guarantee and the Subsidiary Guarantors
hereby irrevocably agree that the obligations of each Subsidiary Guarantor under the Guarantee
shall be limited to the maximum amount as will, after giving effect to all other contingent and
fixed liabilities of such Subsidiary Guarantor and to any collections from or payments made by or
on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary
Guarantor under the Guarantee, not result in the obligations of such
-55-
Subsidiary Guarantor under the Guarantee constituting a fraudulent conveyance or fraudulent
transfer under Federal or state law.
Section 14.04 Release of Subsidiary Guarantors from Guarantee.
(a) Notwithstanding any other provisions of this Indenture, the Guarantee of any Subsidiary
Guarantor may be released upon the terms and subject to the conditions set forth in Section
11.02(b) and in this Section 14.04. Provided that no Default shall have occurred and shall be
continuing under this Indenture, the Guarantee incurred by a Subsidiary Guarantor pursuant to this
Article XIV shall be unconditionally released and discharged (i) automatically upon (A) any sale,
exchange or transfer, whether by way of merger or otherwise, to any Person that is not an Affiliate
of the Partnership, of all of the Partnerships direct or indirect limited partnership or other
equity interests in such Subsidiary Guarantor (provided such sale, exchange or transfer is not
prohibited by this Indenture) or (B) the merger of such Subsidiary Guarantor into either of the
Issuers or any other Subsidiary Guarantor or the liquidation and dissolution of such Subsidiary
Guarantor (in each case to the extent not prohibited by this Indenture) or (ii) upon the Issuers
delivery of a written notice to the Trustee of the release or discharge of all guarantees by such
Subsidiary Guarantor of any Debt of the Issuers other than obligations arising under this Indenture
and any Debt Securities issued hereunder, except a discharge or release by or as a result of
payment under such guarantees.
(b) The Trustee shall deliver an appropriate instrument evidencing any release of a Subsidiary
Guarantor from the Guarantee upon receipt of a written request of the Issuers accompanied by an
Officers Certificate and an Opinion of Counsel to the effect that the Subsidiary Guarantor is
entitled to such release in accordance with the provisions of this Indenture. Any Subsidiary
Guarantor not so released shall remain liable for the full amount of principal of (and premium, if
any) and interest on the Debt Securities entitled to the benefits of the Guarantee as provided in
this Indenture, subject to the limitations of Section 14.03.
Section 14.05 Subsidiary Guarantor Contribution. In order to provide for just and
equitable contribution among the Subsidiary Guarantors, the Subsidiary Guarantors hereby agree,
inter se, that in the event any payment or distribution is made by any Subsidiary Guarantor (a
Funding Guarantor) under the Guarantee, such Funding Guarantor shall be entitled to a
contribution from each other Subsidiary Guarantor (if any) in a pro rata amount based on the net
assets of each Subsidiary Guarantor (including the Funding Guarantor) for all payments, damages and
expenses incurred by that Funding Guarantor in discharging the Issuers obligations with respect to
the Debt Securities or any other Subsidiary Guarantors obligations with respect to the Guarantee.
[Remainder of This Page Intentionally Left Blank.]
-56-
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, all as
of the day and year first above written.
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TARGA RESOURCES PARTNERS LP |
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By: |
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TARGA RESOURCES GP LLC,
its General Partner |
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By: |
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Name: |
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Title: |
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[TARGA RESOURCES PARTNERS FINANCE CORP.] |
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By: |
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Name: |
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Title: |
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[NAME OF SUBSIDIARY GUARANTOR(S)] |
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By: |
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Name: |
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Title: |
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[ ], as Trustee |
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By: |
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Name: |
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[Signature Page to Subordinated Indenture]
ANNEX A
NOTATION OF GUARANTEE
Each of the Subsidiary Guarantors (which term includes any successor Person under the Indenture), has fully, unconditionally and absolutely guaranteed, to the extent set forth in the Indenture and subject to the provisions in the Indenture, the due and punctual payment of the principal of, and premium, if any, and interest on the Debt Securities
and all other amounts due and payable under the Indenture and the Debt Securities by the Issuers.
The obligations of the Subsidiary Guarantors to the Holders of Debt Securities and to the Trustee pursuant to the Guarantee and the Indenture are expressly set forth in Article XIV of the Indenture and reference is hereby made to the Indenture for the precise terms of the Guarantee.
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[NAME OF SUBSIDIARY GUARANTOR(S)] |
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By: |
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Name: |
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A-1
exv4w11
Exhibit 4.11
[Form of Subordinated Indenture]
TARGA RESOURCES PARTNERS LP
TARGA RESOURCES PARTNERS FINANCE CORP.
as Issuers,
any Subsidiary Guarantors party hereto,
and
[ ],
as Trustee
INDENTURE
Dated as of
Debt Securities
[Form of Subordinated Indenture]
CROSS-REFERENCE TABLE
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TIA Section |
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Indenture Section |
310
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(a)
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7.10 |
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(b)
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7.10 |
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(c)
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N.A. |
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311
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(a)
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7.11 |
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(b)
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7.11 |
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(c)
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N.A. |
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312
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(a)
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5.01 |
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(b)
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5.02 |
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(c)
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5.02 |
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313
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(a)
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5.03 |
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(b)
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5.03 |
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(c)
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13.03 |
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(d)
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5.03 |
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314
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(a)
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4.05 |
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(b)
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N.A. |
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(c)(1)
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13.05 |
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(c)(2)
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13.05 |
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(c)(3)
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N.A. |
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(d)
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N.A. |
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(e)
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13.05 |
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(f)
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N.A. |
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315
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(a)
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7.01 |
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(b)
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6.07 & 13.03
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(c)
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7.01 |
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(d)
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7.01 |
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(e)
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6.08 |
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316
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(a) (last sentence)
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1.01 |
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(a)(1)(A)
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6.06 |
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(a)(1)(B)
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6.06 |
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(a)(2)
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9.01 |
(d) |
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(b)
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6.04 |
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(c)
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5.04 |
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317
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(a)(1)
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6.02 |
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(a)(2)
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6.02 |
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(b)
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4.04 |
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318
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(a)
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13.07 |
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N.A. means Not Applicable
NOTE: This Cross-Reference table shall not, for any purpose, be deemed part of this Indenture.
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE |
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Section 1.01
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Definitions
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1 |
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Section 1.02
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Other Definitions
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7 |
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Section 1.03
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Incorporation by Reference of Trust Indenture Act
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7 |
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Section 1.04
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Rules of Construction
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7 |
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ARTICLE II
DEBT SECURITIES |
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Section 2.01
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Forms Generally
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8 |
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Section 2.02
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Form of Trustees Certificate of Authentication
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8 |
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Section 2.03
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Principal Amount; Issuable in Series
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9 |
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Section 2.04
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Execution of Debt Securities
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11 |
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Section 2.05
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Authentication and Delivery of Debt Securities
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Section 2.06
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Denomination of Debt Securities
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13 |
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Section 2.07
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Registration of Transfer and Exchange
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13 |
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Section 2.08
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Temporary Debt Securities
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14 |
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Section 2.09
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Mutilated, Destroyed, Lost or Stolen Debt Securities
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15 |
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Section 2.10
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Cancellation of Surrendered Debt Securities
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16 |
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Section 2.11
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Provisions of the Indenture and Debt Securities for the Sole Benefit of the Parties and the Holders
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16 |
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Section 2.12
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Payment of Interest; Interest Rights Preserved
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16 |
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Section 2.13
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Securities Denominated in Dollars
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17 |
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Section 2.14
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Wire Transfers
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17 |
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Section 2.15
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Securities Issuable in the Form of a Global Security
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17 |
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Section 2.16
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Medium Term Securities
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19 |
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Section 2.17
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Defaulted Interest
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20 |
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Section 2.18
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CUSIP Numbers
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21 |
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ARTICLE III
REDEMPTION OF DEBT SECURITIES |
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Section 3.01
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Applicability of Article
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Section 3.02
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Notice of Redemption; Selection of Debt Securities
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21 |
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Section 3.03
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Payment of Debt Securities Called for Redemption
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23 |
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Section 3.04
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Mandatory and Optional Sinking Funds
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23 |
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Section 3.05
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Redemption of Debt Securities for Sinking Fund
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24 |
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ARTICLE IV
PARTICULAR COVENANTS OF THE ISSUERS |
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Section 4.01
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Payment of Principal of, and Premium, If Any, and Interest on, Debt Securities
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Section 4.02
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Maintenance of Offices or Agencies for Registration of Transfer, Exchange and Payment of Debt Securities
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Section 4.03
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Appointment to Fill a Vacancy in the Office of Trustee
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Section 4.04
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Duties of Paying Agents, etc
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26 |
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Section 4.05
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SEC Reports; Financial Statements
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27 |
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Section 4.06
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Compliance Certificate
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27 |
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Section 4.07
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Further Instruments and Acts
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28 |
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Section 4.08
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Existence
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28 |
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Section 4.09
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Maintenance of Properties
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28 |
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Section 4.10
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Payment of Taxes and Other Claims
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28 |
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Section 4.11
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Waiver of Certain Covenants
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29 |
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ARTICLE V
HOLDERS LISTS AND REPORTS BY THE TRUSTEE |
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Section 5.01
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Issuers to Furnish Trustee Information as to Names and Addresses of Holders; Preservation of Information
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29 |
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Section 5.02
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Communications to Holders
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29 |
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Section 5.03
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Reports by Trustee
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30 |
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Section 5.04
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Record Dates for Action by Holders
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30 |
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ARTICLE VI
REMEDIES OF THE TRUSTEE AND HOLDERS IN EVENT OF DEFAULT |
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Section 6.01
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Events of Default
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30 |
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Section 6.02
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Collection of Debt by Trustee, etc
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32 |
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Section 6.03
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Application of Moneys Collected by Trustee
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34 |
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Section 6.04
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Limitation on Suits by Holders
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34 |
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Section 6.05
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Remedies Cumulative; Delay or Omission in Exercise of Rights Not a Waiver of Default
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35 |
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Section 6.06
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Rights of Holders of Majority in Principal Amount of Debt Securities to Direct Trustee and to Waive Default
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35 |
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Section 6.07
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Trustee to Give Notice of Events of Defaults Known to It, but May Withhold Such Notice in Certain Circumstances
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36 |
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Section 6.08
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Requirement of an Undertaking to Pay Costs in Certain Suits under the Indenture or Against the Trustee
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36 |
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ARTICLE VII
CONCERNING THE TRUSTEE |
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Section 7.01
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Certain Duties and Responsibilities
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37 |
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Section 7.02
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Certain Rights of Trustee
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38 |
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Section 7.03
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Trustee Not Liable for Recitals in Indenture or in Debt Securities
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39 |
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Section 7.04
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Trustee, Paying Agent or Registrar May Own Debt Securities
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39 |
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Section 7.05
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Moneys Received by Trustee to Be Held in Trust
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39 |
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Section 7.06
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Compensation and Reimbursement
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39 |
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Section 7.07
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Right of Trustee to Rely on an Officers Certificate Where No Other Evidence Specifically Prescribed
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40 |
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Section 7.08
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Separate Trustee; Replacement of Trustee
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40 |
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Section 7.09
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Successor Trustee by Merger
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41 |
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Section 7.10
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Eligibility; Disqualification
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42 |
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Section 7.11
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Preferential Collection of Claims Against Issuers
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42 |
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Section 7.12
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Compliance with Tax Laws
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42 |
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ARTICLE VIII
CONCERNING THE HOLDERS |
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Section 8.01
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Evidence of Action by Holders
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42 |
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Section 8.02
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Proof of Execution of Instruments and of Holding of Debt Securities
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43 |
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Section 8.03
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Who May Be Deemed Owner of Debt Securities
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43 |
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Section 8.04
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Instruments Executed by Holders Bind Future Holders
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43 |
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ARTICLE IX
SUPPLEMENTAL INDENTURES |
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Section 9.01
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Purposes for Which Supplemental Indenture May Be Entered into Without Consent of Holders
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44 |
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Section 9.02
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Modification of Indenture with Consent of Holders of Debt Securities
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46 |
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Section 9.03
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Effect of Supplemental Indentures
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47 |
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Section 9.04
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Debt Securities May Bear Notation of Changes by Supplemental Indentures
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ARTICLE X
CONSOLIDATION, MERGER, SALE OR CONVEYANCE |
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Section 10.01
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Consolidations and Mergers of the Issuers
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48 |
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Section 10.02
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Rights and Duties of Successor Company
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48 |
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ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE;
DEFEASANCE; UNCLAIMED MONEYS |
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Section 11.01
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Applicability of Article
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49 |
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Section 11.02
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Satisfaction and Discharge of Indenture; Defeasance
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49 |
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Section 11.03
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Conditions of Defeasance
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50 |
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Section 11.04
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Application of Trust Money
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51 |
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Section 11.05
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Repayment to Issuers
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51 |
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Section 11.06
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Indemnity for U.S. Government Obligations
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51 |
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Section 11.07
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Reinstatement
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51 |
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ARTICLE XII
SUBORDINATION OF DEBT SECURITIES AND GUARANTEE |
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Section 12.01
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Applicability of Article; Agreement to Subordinate
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52 |
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Section 12.02
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Liquidation, Dissolution, Bankruptcy
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52 |
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Section 12.03
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Default on Senior Indebtedness
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52 |
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Section 12.04
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Acceleration of Payment of Debt Securities
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53 |
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Section 12.05
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When Distribution Must Be Paid Over
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53 |
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Section 12.06
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Subrogation
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54 |
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Section 12.07
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Relative Rights
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54 |
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Section 12.08
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Subordination May Not Be Impaired by Issuers
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54 |
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Section 12.09
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Rights of Trustee and Paying Agent
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54 |
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Section 12.10
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Distribution or Notice to Representative
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55 |
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Section 12.11
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Article XII Not to Prevent Defaults or Limit Right to Accelerate
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55 |
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Section 12.12
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Trust Moneys Not Subordinated
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55 |
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Section 12.13
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Trustee Entitled to Rely
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55 |
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Section 12.14
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Trustee to Effectuate Subordination
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55 |
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Section 12.15
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Trustee Not Fiduciary for Holders of Senior Indebtedness
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56 |
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Section 12.16
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Reliance by Holders of Senior Indebtedness on Subordination Provisions
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56 |
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ARTICLE XIII
MISCELLANEOUS PROVISIONS |
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Section 13.01
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Successors and Assigns of Issuers Bound by Indenture
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56 |
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Section 13.02
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Acts of Board, Committee or Officer of Successor Issuer Valid
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56 |
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Section 13.03
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Required Notices or Demands
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56 |
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Section 13.04
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Indenture and Debt Securities to Be Construed in Accordance with the Laws of the State of New York
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57 |
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Section 13.05
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Officers Certificate and Opinion of Counsel to Be Furnished upon Application or Demand by the Issuers
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57 |
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Section 13.06
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Payments Due on Legal Holidays
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58 |
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Section 13.07
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Provisions Required by TIA to Control
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58 |
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Section 13.08
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Computation of Interest on Debt Securities
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58 |
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Section 13.09
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Rules by Trustee, Paying Agent and Registrar
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58 |
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Section 13.10
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No Recourse Against Others
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58 |
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Section 13.11
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Severability
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59 |
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Section 13.12
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Effect of Headings
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59 |
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Section 13.13
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Indenture May Be Executed in Counterparts
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59 |
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ARTICLE XIV
GUARANTEE |
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Section 14.01
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Unconditional Guarantee
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59 |
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Section 14.02
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Execution and Delivery of Guarantee
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61 |
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Section 14.03
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Limitation on Subsidiary Guarantors Liability
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61 |
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Section 14.04
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Release of Subsidiary Guarantors from Guarantee
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61 |
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Section 14.05
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Subsidiary Guarantor Contribution
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62 |
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Notation of Guarantee |
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Annex A
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-v-
THIS INDENTURE dated as of is among Targa Resources Partners LP, a Delaware
limited partnership (the Partnership), Targa Resources Partners Finance Corp. (Finance Corp.,
and together with the Partnership, the Issuers), any Subsidiary Guarantors (as defined herein
party hereto and [ ], a
, as trustee (the Trustee).
RECITALS OF THE ISSUERS AND ANY SUBSIDIARY GUARANTORS
The Issuers and any Subsidiary Guarantors have duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of the Issuers debentures, notes,
bonds or other evidences of indebtedness to be issued in one or more series unlimited as to
principal amount (herein called the Debt Securities), which Debt Securities may be guaranteed by
each of the Subsidiary Guarantors and may be subordinated in right of payment to Senior
Indebtedness, as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the Issuers and any
Subsidiary Guarantors, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH
That in order to declare the terms and conditions upon which the Debt Securities are
authenticated, issued and delivered, and in consideration of the premises, and of the purchase and
acceptance of the Debt Securities by the Holders thereof, the Issuers, any Subsidiary Guarantor and
the Trustee covenant and agree with each other, for the benefit of the respective Holders from time
to time of the Debt Securities or any series thereof, as follows:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
Affiliate of any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified Person. For the
purposes of this definition, control when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms controlling and
controlled have meanings correlative to the foregoing. The Trustee may request and may
conclusively rely upon an Officers Certificate to determine whether any Person is an Affiliate of
any specified Person.
Agent means any Registrar or paying agent.
Bankruptcy Law means Title 11, U.S. Code or any similar federal or state law for the relief
of debtors.
Board of Directors means, (i) with respect to Finance Corp., the board of directors of the
corporation or any committee thereof duly authorized to act on behalf of such board, (ii) with
respect to the Partnership, the Board of Directors of the General Partner or any authorized
-1-
committee of the Board of Directors of the General Partner or any directors and/or officers of
the General Partner to whom such Board of Directors or such committee shall have duly delegated its
authority to act hereunder. If the Partnership shall change its form of entity to other than a
limited partnership, the references to the Board of Directors of the General Partner shall mean the
Board of Directors (or other comparable governing body) of the Partnership.
Business Day means any day other than a Legal Holiday.
capital stock of any Person means and includes any and all shares, rights to purchase,
warrants or options (whether or not currently exercisable), participations or other equivalents of
or interests in (however designated) the equity (which includes, but is not limited to, common
stock, preferred stock and partnership and joint venture interests) of such Person (excluding any
debt securities that are convertible into, or exchangeable for, such equity).
Custodian means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
Debt of any Person at any date means any obligation created or assumed by such Person for
the repayment of borrowed money and any guarantee thereof.
Debt Security or Debt Securities has the meaning stated in the first recital of this
Indenture and more particularly means any debt security or debt securities, as the case may be of
any series authenticated and delivered under this Indenture.
Default means any event, act or condition that is, or after notice or the passage of time or
both would be, an Event of Default.
Depositary means, unless otherwise specified by the Issuers pursuant to either Section 2.03
or 2.15, with respect to Debt Securities of any series issuable or issued in whole or in part in
the form of one or more Global Securities, The Depository Trust Company, New York, New York, or any
successor thereto registered as a clearing agency under the Exchange Act or other applicable
statute or regulations.
Designated Senior Indebtedness means (i) any Senior Indebtedness which, at the date of
determination, has an aggregate principal amount outstanding of, or under which, at the date of
determination, the holders thereof are committed to lend up to, at least $100 million and (ii) any
other Senior Indebtedness designated, as provided in Section 2.03, in respect of any series of Debt
Securities.
Dollar or $ means such currency of the United States as at the time of payment is legal
tender for the payment of public and private debts.
Exchange Act means the Securities Exchange Act of 1934, as amended, and any successor
statute.
Finance Corp. means the Person named as Finance Corp. in the first paragraph of this
instrument until a successor Person shall have become such pursuant to the applicable terms of this
Indenture, and thereafter Finance Corp. shall mean such successor Person.
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Floating Rate Security means a Debt Security that provides for the payment of interest at a
variable rate determined periodically by reference to an interest rate index specified pursuant to
Section 2.03.
GAAP means generally accepted accounting principles in the United States, as in effect from
time to time.
General Partner means Targa Resources GP LLC, a Delaware limited liability company, and its
successors and permitted assigns as general partner of the Partnership or as the business entity
with the ultimate authority to manage the business and operations of the Partnership.
Global Security means with respect to any series of Debt Securities issued hereunder, a Debt
Security which is executed by the Issuers and authenticated and delivered by the Trustee to the
Depositary or pursuant to the Depositarys instruction, all in accordance with this Indenture and
any Indentures supplemental hereto, or resolution of the Board of Directors and set forth in an
Officers Certificate, which shall be registered in the name of the Depositary or its nominee and
which shall represent, and shall be denominated in an amount equal to the aggregate principal
amount of, all the Outstanding Debt Securities of such series or any portion thereof, in either
case having the same terms, including, without limitation, the same original issue date, date or
dates on which principal is due and interest rate or method of determining interest.
guarantee means any obligation, contingent or otherwise, of any Person directly or
indirectly guaranteeing any Debt or other obligation of any other Person and any obligation, direct
or indirect, contingent or otherwise, of such Person (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Debt or other obligation of such other Person (whether
arising by virtue of partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial statement conditions or
otherwise) or (b) entered into for purposes of assuring in any other manner the obligee of such
Debt or other obligation of the payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part); provided, however, that the term guarantee shall not include
endorsements for collection or deposit in the ordinary course of business. The term guarantee
used as a verb has a corresponding meaning.
Holder, Holder of Debt Securities or other similar terms means, a Person in whose name a
Debt Security is registered in the Debt Security Register (as defined in Section 2.07(a)).
Indenture means this instrument as originally executed, or, if amended or supplemented as
herein provided, as so amended or supplemented and shall include the form and terms of particular
series of Debt Securities as contemplated hereunder, whether or not a supplemental Indenture is
entered into with respect thereto.
Issuers means the Partnership and Finance Corp.
Issuer Order means a written request or order signed on behalf of each of the Issuers by one
of its Officers and delivered to the Trustee.
-3-
Legal Holiday means a Saturday, a Sunday or a day on which banking institutions in the City
of Houston, Texas, City of New York, New York or at a Place of Payment are authorized by law,
regulation or executive order to remain closed. If a payment date is a Legal Holiday at a Place of
Payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period.
Lien means, with respect to any asset, any mortgage, lien, security interest, pledge, charge
or other encumbrance of any kind in respect of such asset, whether or not filed, recorded or
otherwise perfected under applicable law.
Officer means, with respect to any Person, the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer,
any Assistant Treasurer, the Controller, the Secretary or any Vice President of such Person (or, if
such Person is a limited partnership, the general partner of such Person, except it shall be the
General Partner in the case of the Partnership so long as it is a limited partnership).
Officers Certificate means a certificate signed on behalf of each Issuer by any two of its
Officers, one of whom must be the principal executive officer, the principal financial officer or
the principal accounting officer of such Issuer, that meets the requirements of Section 13.05
hereof.
Opinion of Counsel means a written opinion from legal counsel who is acceptable to the
Trustee. The counsel may be an employee of or counsel to the Partnership or the Trustee.
Original Issue Discount Debt Security means any Debt Security which provides for an amount
less than the principal amount thereof to be due and payable upon a declaration of acceleration of
the maturity thereof pursuant to Section 6.01.
Outstanding, when used with respect to any series of Debt Securities, means, as of the date
of determination, all Debt Securities of that series theretofore authenticated and delivered under
this Indenture, except:
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(a) |
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Debt Securities of that series theretofore canceled by the Trustee or delivered
to the Trustee for cancellation; |
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(b) |
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Debt Securities of that series for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or any paying agent
(other than an Issuer) in trust or set aside and segregated in trust by the Issuers (if
an Issuer shall act as its own paying agent) for the Holders of such Debt Securities;
provided, that, if such Debt Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor satisfactory to
the Trustee has been made; and |
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(c) |
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Debt Securities of that series which have been paid pursuant to Section 2.09 or
in exchange for or in lieu of which other Debt Securities have been authenticated and
delivered pursuant to this Indenture, other than any such Debt Securities in respect of
which there shall have been presented to the Trustee proof satisfactory |
-4-
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to it that such Debt Securities are held by a protected purchaser in whose hands
such Debt Securities are valid obligations of the Issuers; |
provided, however, that in determining whether the Holders of the requisite principal amount of the
Outstanding Debt Securities of any series have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Debt Securities owned by either of the Issuers or any other
obligor upon the Debt Securities or any Affiliate of the Partnership or of such other obligor shall
be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Debt Securities which a Trust Officer actually knows to be so owned shall
be so disregarded. Debt Securities so owned which have been pledged in good faith may be regarded
as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgees right so
to act with respect to such Debt Securities and that the pledgee is not an Issuer or any other
obligor upon the Debt Securities or an Affiliate of the Partnership or of such other obligor. In
determining whether the Holders of the requisite principal amount of Outstanding Debt Securities
have given any request, demand, authorization, direction, notice, consent or waiver hereunder, the
principal amount of an Original Issue Discount Debt Security that shall be deemed to be Outstanding
for such purposes shall be the amount of the principal thereof that would be due and payable as of
the date of such determination upon a declaration of acceleration of the maturity thereof pursuant
to Section 6.01.
Partnership means the Person named as the Partnership in the first paragraph of this
instrument until a successor Person shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter Partnership shall mean such successor Person.
Person means any individual, corporation, partnership, joint venture, limited liability
company, incorporated or unincorporated association, joint-stock company, trust, unincorporated
organization or government or other agency or political subdivision thereof or other entity of any
kind.
Redemption Date, when used with respect to any Debt Security to be redeemed, means the date
fixed for such redemption by or pursuant to this Indenture.
Representative means the trustee, agent or representative (if any) for an issue of Senior
Debt.
SEC means the Securities and Exchange Commission.
Securities Act means the Securities Act of 1933, as amended, and any successor statute.
Senior Indebtedness, unless otherwise provided with respect to the Debt Securities of a
series as contemplated by Section 2.03, means (1) all Debt of the Subsidiary Guarantors or the
Issuers, whether currently outstanding or hereafter issued, unless, by the terms of the instrument
creating or evidencing such Debt, it is provided that such Debt is subordinate or not superior in
right of payment to the Debt Securities, in the case of the Issuers, or the Guarantee, in the case
of the Subsidiary Guarantors, or to other Debt which is pari passu with or subordinated to the Debt
Securities, in the case of the Issuers, or the Guarantee, in the case of the Subsidiary Guarantors,
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and (2) any modifications, refunding, deferrals, renewals, or extensions of any such Debt or
securities, notes or other evidence of Debt issued in exchange for such Debt; provided that in no
event shall Senior Indebtedness include (a) Debt evidenced by the Debt Securities or any
Guarantee, (b) Debt of any of the Subsidiary Guarantors or the Issuers owed or owing to any
Subsidiary of the Partnership, (c) Debt of any of the Subsidiary Guarantors owed or owing to the
Issuers, (d) Debt to trade creditors, (e) any liability for taxes owed or owing by any of the
Subsidiary Guarantors or the Issuers or (f) Debt of any Subsidiary Guarantor in the event there is
no series of Debt Securities Outstanding that is entitled to the benefits of a Guarantee.
Stated Maturity means, with respect to any security, the date specified in such security as
the fixed date on which the payment of principal of such security is due and payable, including
pursuant to any mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has occurred).
Subsidiary of any Person means:
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(1) |
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any corporation, association or other business entity of which more than 50% of
the total voting power of equity interests entitled, without regard to the occurrence
of any contingency, to vote in the election of directors, managers, trustees or
equivalent Persons thereof is at the time of determination owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries of such
Person or combination thereof; or |
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(2) |
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in the case of a partnership, more than 50% of the partners equity interests,
considering all partners equity interests as a single class, is at such time of
determination owned or controlled, directly or indirectly, by such Person or one or
more of the other Subsidiaries of such Person or combination thereof. |
Subsidiary Guarantors means any Subsidiary of the Partnership (except Finance Corp.) who may
execute this Indenture, or a supplement hereto, for the purpose of providing a Guarantee of Debt
Securities pursuant to this Indenture until a successor Person shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter Subsidiary Guarantors shall mean such
successor Person.
TIA means the Trust Indenture Act of 1939, as amended (15 U.S.C. §§ 77aaa-77bbbb), as in
effect on the date of this Indenture as originally executed and, to the extent required by law, as
amended.
Trustee initially means [ ] and any other Person or Persons appointed as
such from time to time pursuant to Section 7.08, and, subject to the provisions of Article VII,
includes its or their successors and assigns. If at any time there is more than one such Person,
Trustee as used with respect to the Debt Securities of any series shall mean the Trustee with
respect to the Debt Securities of that series.
Trust Officer means any officer or assistant officer of the Trustee assigned by the Trustee
to administer its corporate trust matters.
-6-
United States means the United States of America (including the States and the District of
Columbia), its territories, its possessions and other areas subject to its jurisdiction.
U.S. Government Obligations means direct obligations of the United States of America,
obligations on which the payment of principal and interest is fully guaranteed by the United States
of America or obligations or guarantees for the payment of which the full faith and credit of the
United States of America is pledged.
Yield to Maturity means the yield to maturity, calculated at the time of issuance of a
series of Debt Securities, or, if applicable, at the most recent redetermination of interest on
such series and calculated in accordance with accepted financial practice.
Section 1.02 Other Definitions.
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Term |
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Defined in Section |
Debt Security Register |
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2.07 |
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Defaulted Interest |
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2.17 |
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Event of Default |
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6.01 |
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Funding Guarantor |
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14.05 |
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Guarantee |
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14.01 |
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Place of Payment |
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2.03 |
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Registrar |
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2.07 |
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Subordinated Debt Securities |
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12.01 |
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Successor Company |
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10.01 |
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Section 1.03 Incorporation by Reference of Trust Indenture Act. Whenever this
Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made
a part of this Indenture.
All terms used in this Indenture that are defined by the TIA, defined by TIA reference to
another statute or defined by SEC rule under the TIA have the meanings so assigned to them.
Section 1.04 Rules of Construction. Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to it in accordance with
GAAP;
(c) or is not exclusive;
(d) words in the singular include the plural, and in the plural include the singular;
(e) provisions apply to successive events and transactions;
-7-
(f) if the applicable series of Debt Securities are subordinated pursuant to Article XII,
unsecured Debt shall not be deemed to be subordinate or junior to secured Debt merely by virtue of
its nature as unsecured Debt; and
(g) the principal amount of any noninterest bearing or other discount security at any date
shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated
such date prepared in accordance with GAAP.
ARTICLE II
DEBT SECURITIES
Section 2.01 Forms Generally. The Debt Securities of each series shall be in
substantially the form established without the approval of any Holder by or pursuant to a
resolution of the Board of Directors of each Issuer or in one or more Indentures supplemental
hereto, in each case with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon as the Issuers may
deem appropriate (and, if not contained in a supplemental Indenture entered into in accordance with
Article IX, as are not prohibited by the provisions of this Indenture) or as may be required or
appropriate to comply with any law or with any rules made pursuant thereto or with any rules of any
securities exchange on which such series of Debt Securities may be listed, or to conform to general
usage, or as may, consistently herewith, be determined by the officers executing such Debt
Securities as evidenced by their execution of the Debt Securities.
The definitive Debt Securities of each series shall be printed, lithographed or engraved on
steel engraved borders or may be produced in any other manner, all as determined by the officers
executing such Debt Securities, as evidenced by their execution of such Debt Securities.
Section 2.02 Form of Trustees Certificate of Authentication. The Trustees
certificate of authentication on all Debt Securities authenticated by the Trustee shall be in
substantially the following form:
TRUSTEES CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series designated therein referred to in the
within-mentioned Indenture.
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[ ],
As Trustee |
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By: |
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Authorized Signatory
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-8-
Section 2.03 Principal Amount; Issuable in Series. The aggregate principal amount of
Debt Securities which may be issued, executed, authenticated, delivered and outstanding under this
Indenture is unlimited.
The Debt Securities may be issued in one or more series in fully registered form. There shall
be established, without the approval of any Holders, in or pursuant to a resolution of the Board of
Directors of each Issuer and set forth in an Officers Certificate, or established in one or more
Indentures supplemental hereto, prior to the issuance of Debt Securities of any series any or all
of the following:
(a) the title of the Debt Securities of the series (which shall distinguish the Debt
Securities of the series from all other Debt Securities);
(b) any limit upon the aggregate principal amount of the Debt Securities of the series which
may be authenticated and delivered under this Indenture (except for Debt Securities authenticated
and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Debt
Securities of the series pursuant to this Article II);
(c) the date or dates on which the principal of and premium, if any, on the Debt Securities of
the series are payable;
(d) the rate or rates (which may be fixed or variable) at which the Debt Securities of the
series shall bear interest, if any, or the method of determining such rate or rates, the date or
dates from which such interest shall accrue, the interest payment dates on which such interest
shall be payable, or the method by which such date will be determined, the record dates for the
determination of Holders thereof to whom such interest is payable; and the basis upon which
interest will be calculated if other than that of a 360-day year of twelve thirty-day months;
(e) the place or places, if any, in addition to or instead of the corporate trust office of
the Trustee, where the principal of, and premium, if any, and interest on, Debt Securities of the
series shall be payable (Place of Payment);
(f) the price or prices at which, the period or periods within which and the terms and
conditions upon which Debt Securities of the series may be redeemed, in whole or in part, at the
option of the Issuers or otherwise;
(g) whether Debt Securities of the series are entitled to the benefits of any Guarantee of any
Subsidiary Guarantors pursuant to this Indenture;
(h) the obligation, if any, of the Issuers to redeem, purchase or repay Debt Securities of the
series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof,
and the price or prices at which and the period or periods within which and the terms and
conditions upon which Debt Securities of the series shall be redeemed, purchased or repaid, in
whole or in part, pursuant to such obligations;
(i) the terms, if any, upon which the Debt Securities of the series may be convertible into or
exchanged for capital stock (which may be represented by depositary shares), other Debt Securities
or warrants for capital stock or Debt or other securities of any kind of either of the
-9-
Issuers or any other obligor and the terms and conditions upon which such conversion or
exchange shall be effected, including the initial conversion or exchange price or rate, the
conversion or exchange period and any other provision in addition to or in lieu of those described
herein;
(j) if other than denominations of $1,000 and any integral multiple thereof, the denominations
in which Debt Securities of the series shall be issuable;
(k) if the amount of principal of or any premium or interest on Debt Securities of the series
may be determined with reference to an index or pursuant to a formula, the manner in which such
amounts will be determined;
(l) if the principal amount payable at the Stated Maturity of Debt Securities of the series
will not be determinable as of any one or more dates prior to such Stated Maturity, the amount
which will be deemed to be such principal amount as of any such date for any purpose, including the
principal amount thereof which will be due and payable upon any maturity other than the Stated
Maturity or which will be deemed to be Outstanding as of any such date (or, in any such case, the
manner in which such deemed principal amount is to be determined);
(m) any changes or additions to Article XI, including the addition of additional covenants
that may be subject to the covenant defeasance option pursuant to Section 11.02(b);
(n) if other than the principal amount thereof, the portion of the principal amount of Debt
Securities of the series which shall be payable upon declaration of acceleration of the maturity
thereof pursuant to Section 6.01 or provable in bankruptcy pursuant to Section 6.02;
(o) the terms, if any, of the transfer, mortgage, pledge or assignment as security for the
Debt Securities of the series of any properties, assets, moneys, proceeds, securities or other
collateral, including whether certain provisions of the TIA are applicable and any corresponding
changes to provisions of this Indenture as currently in effect;
(p) any addition to or change in the Events of Default with respect to the Debt Securities of
the series and any change in the right of the Trustee or the Holders to declare the principal of,
and premium and interest on, such Debt Securities due and payable;
(q) if the Debt Securities of the series shall be issued in whole or in part in the form of a
Global Security or Securities, the terms and conditions, if any, upon which such Global Security or
Securities may be exchanged in whole or in part for other individual Debt Securities in definitive
registered form; and the Depositary for such Global Security or Securities and the form of any
legend or legends to be borne by any such Global Security or Securities in addition to or in lieu
of the legend referred to in Section 2.15(a);
(r) any trustees, authenticating or paying agents, transfer agents or registrars;
(s) the applicability of, and any addition to or change in the covenants and definitions
currently set forth in this Indenture or in the terms currently set forth in Article X, including
conditioning any merger, conveyance, transfer or lease permitted by Article X upon the
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satisfaction of any Debt coverage standard by the Issuers and Successor Company (as defined in
Article X);
(t) the subordination, if any, of the Debt Securities of the series pursuant to Article XII
and any changes or additions to Article XII or designation of any Designated Senior Indebtedness;
(u) with regard to Debt Securities of the series that do not bear interest, the dates for
certain required reports to the Trustee; and
(v) any other terms of the Debt Securities of the series (which terms shall not be prohibited
by the provisions of this Indenture).
All Debt Securities of any one series shall be substantially identical except as to
denomination and except as may otherwise be provided in or pursuant to such resolution of the Board
of Directors and as set forth in such Officers Certificate or in any such Indenture supplemental
hereto.
Section 2.04 Execution of Debt Securities. The Debt Securities shall be signed on
behalf of each of the Issuers by at least one of its Officers. Such signatures upon the Debt
Securities may be the manual or facsimile signatures of the present or any future such authorized
officers and may be imprinted or otherwise reproduced on the Debt Securities.
Only such Debt Securities as shall bear thereon a certificate of authentication substantially
in the form hereinbefore recited, signed manually by the Trustee, shall be entitled to the benefits
of this Indenture or be valid or obligatory for any purpose. Such certificate by the Trustee upon
any Debt Security executed on behalf of each of the Issuers by at least one of its Officers shall
be conclusive evidence that the Debt Security so authenticated has been duly authenticated and
delivered hereunder.
In case any Officer of either Issuer who shall have signed any of the Debt Securities shall
cease to be such Officer before the Debt Securities so signed shall have been authenticated and
delivered by the Trustee, or disposed of by the Issuers, such Debt Securities nevertheless may be
authenticated and delivered or disposed of as though the Person who signed such Debt Securities had
not ceased to be such Officer; and any Debt Security may be signed on behalf of either Issuer by
such Persons as, at the actual date of the execution of such Debt Security, shall be the proper
Officers of such Issuer, although at the date of such Debt Security or of the execution of this
Indenture any such Person was not such Officer.
Section 2.05 Authentication and Delivery of Debt Securities. At any time and from
time to time after the execution and delivery of this Indenture, the Issuers may deliver to the
Trustee for authentication Debt Securities of any series executed by the Issuers, and the Trustee
shall thereupon authenticate and deliver said Debt Securities to or upon an Issuer Order. In
authenticating such Debt Securities, and accepting the additional responsibilities under this
Indenture in relation to such Debt Securities, the Trustee shall be entitled to receive, and
(subject to Section 7.01) shall be fully protected in relying upon:
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(a) a copy of any resolution or resolutions of the Board of Directors of each Issuer,
certified by the Secretary or Assistant Secretary of each of the General Partner and Finance Corp.,
authorizing the terms of issuance of any series of Debt Securities;
(b) an executed supplemental Indenture, if any;
(c) an Officers Certificate; and
(d) an Opinion of Counsel prepared in accordance with Section 13.05 which shall also state:
(i) that the form of such Debt Securities has been established by or pursuant to a
resolution of the Board of Directors of each Issuer or by a supplemental Indenture as
permitted by Section 2.01 in conformity with the provisions of this Indenture;
(ii) that the terms of such Debt Securities have been established by or pursuant to a
resolution of the Board of Directors or by a supplemental Indenture as permitted by Section
2.03 in conformity with the provisions of this Indenture;
(iii) that such Debt Securities, when authenticated and delivered by the Trustee and
issued by the Issuers in the manner and subject to any conditions specified in such Opinion
of Counsel, will constitute valid and legally binding obligations of the Issuers,
enforceable in accordance with their terms except as the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors
rights generally and rights of acceleration and the availability of equitable remedies may
be limited by equitable principles of general applicability;
(iv) that the Issuers have the power to issue such Debt Securities and has duly taken
all necessary action with respect to such issuance;
(v) that the issuance of such Debt Securities will not contravene the organizational
documents of the Issuers or result in any material violation of any of the terms or
provisions of any law or regulation or of any material indenture, mortgage or other
agreement known to such counsel by which the Issuers are bound;
(vi) that authentication and delivery of such Debt Securities and the execution and
delivery of any supplemental Indenture will not violate the terms of this Indenture; and
(vii) such other matters as the Trustee may reasonably request.
Such Opinion of Counsel need express no opinion as to whether a court in the United States
would render a money judgment in a currency other than that of the United States.
The Trustee shall have the right to decline to authenticate and deliver any Debt Securities
under this Section 2.05 if the Trustee, being advised by counsel, determines that such action may
not lawfully be taken or if the Trustee in good faith by its board of directors or trustees,
executive committee or a trust committee of directors, trustees or Officers (or any combination
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thereof) shall determine that such action would expose the Trustee to personal liability to
existing Holders.
The Trustee may appoint an authenticating agent reasonably acceptable to the Issuers to
authenticate Debt Securities of any series. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Debt Securities whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes authentication by such agent.
An authenticating agent has the same rights as any Registrar, paying agent or agent for service of
notices and demands.
Unless otherwise provided in the form of Debt Security for any series, each Debt Security
shall be dated the date of its authentication.
Section 2.06 Denomination of Debt Securities. Unless otherwise provided in the form
of Debt Security for any series, the Debt Securities of each series shall be issuable only as fully
registered Debt Securities in such Dollar denominations as shall be specified or contemplated by
Section 2.03. In the absence of any such specification with respect to the Debt Securities of any
series, the Debt Securities of such series shall be issuable in denominations of $1,000 and any
integral multiple thereof.
Section 2.07 Registration of Transfer and Exchange.
(a) The Issuers shall keep or cause to be kept a register for each series of Debt Securities
issued hereunder (hereinafter collectively referred to as the Debt Security Register), in which,
subject to such reasonable regulations as it may prescribe, the Issuers shall provide for the
registration of all Debt Securities and the transfer of Debt Securities as in this Article II
provided. At all reasonable times the Debt Security Register shall be open for inspection by the
Trustee. Subject to Section 2.15, upon due presentment for registration of transfer of any Debt
Security at any office or agency to be maintained by the Issuers in accordance with the provisions
of Section 4.02, the Issuers shall execute and the Trustee shall authenticate and deliver in the
name of the transferee or transferees a new Debt Security or Debt Securities of authorized
denominations for a like aggregate principal amount. In no event may Debt Securities be issued as,
or exchanged for, bearer securities.
Unless and until otherwise determined by the Issuers by resolutions of each Issuers Board of
Directors, the Debt Security Register shall be kept at the principal corporate trust office of the
Trustee and, for this purpose, the Trustee shall be designated Registrar.
Debt Securities of any series (other than a Global Security, except as set forth below) may be
exchanged for a like aggregate principal amount of Debt Securities of the same series of other
authorized denominations. Subject to Section 2.15, Debt Securities to be exchanged shall be
surrendered at the office or agency to be maintained by the Issuers as provided in Section 4.02,
and the Issuers shall execute and the Trustee shall authenticate and deliver in exchange therefor
the Debt Security or Debt Securities which the Holder making the exchange shall be entitled to
receive.
(b) All Debt Securities presented or surrendered for registration of transfer, exchange or
payment shall (if so required by the Issuers, the Trustee or the Registrar) be duly endorsed or
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be accompanied by a written instrument or instruments of transfer, in form satisfactory to the
Issuers, the Trustee and the Registrar, duly executed by the Holder or his attorney duly authorized
in writing.
All Debt Securities issued in exchange for or upon transfer of Debt Securities shall be the
valid obligations of the Issuers, evidencing the same debt, and entitled to the same benefits under
this Indenture as the Debt Securities surrendered for such exchange or transfer.
No service charge shall be made for any exchange or registration of transfer of Debt
Securities (except as provided by Section 2.09), but the Issuers may require payment of a sum
sufficient to cover any tax, fee, assessment or other governmental charge that may be imposed in
relation thereto, other than those expressly provided in this Indenture to be made at the Issuers
own expense or without expense or without charge to the Holders.
The Issuers shall not be required (i) to issue, register the transfer of or exchange any Debt
Securities for a period of 15 days next preceding any mailing of notice of redemption of Debt
Securities of such series or (ii) to register the transfer of or exchange any Debt Securities
selected, called or being called for redemption.
Prior to the due presentation for registration of transfer of any Debt Security, the Issuers,
the Subsidiary Guarantors, the Trustee, any paying agent or any Registrar may deem and treat the
Person in whose name a Debt Security is registered as the absolute owner of such Debt Security for
the purpose of receiving payment of or on account of the principal of, and premium, if any, and
(subject to Section 2.12) interest on, such Debt Security and for all other purposes whatsoever,
whether or not such Debt Security is overdue, and none of the Issuers, the Subsidiary Guarantors,
the Trustee, any paying agent or any Registrar shall be affected by notice to the contrary.
None of the Issuers, the Subsidiary Guarantors, the Trustee, any agent of the Trustee, any
paying agent or any Registrar will have any responsibility or liability for any aspect of the
records relating to, or payments made on account of, beneficial ownership interests of a Global
Security or for maintaining, supervising or reviewing any records relating to such beneficial
ownership interests.
Section 2.08 Temporary Debt Securities. Pending the preparation of definitive Debt
Securities of any series, the Issuers may execute and the Trustee shall authenticate and deliver
temporary Debt Securities (printed, lithographed, photocopied, typewritten or otherwise produced)
of any authorized denomination, and substantially in the form of the definitive Debt Securities in
lieu of which they are issued, in registered form with such omissions, insertions and variations as
may be appropriate for temporary Debt Securities, all as may be determined by the Issuers with the
concurrence of the Trustee. Temporary Debt Securities may contain such reference to any provisions
of this Indenture as may be appropriate. Every temporary Debt Security shall be executed by the
Issuers and be authenticated by the Trustee upon the same conditions and in substantially the same
manner, and with like effect, as the definitive Debt Securities.
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If temporary Debt Securities of any series are issued, the Issuers will cause definitive Debt
Securities of such series to be prepared without unreasonable delay. After the preparation of
definitive Debt Securities of such series, the temporary Debt Securities of such series shall be
exchangeable for definitive Debt Securities of such series upon surrender of the temporary Debt
Securities of such series at the office or agency of the Issuers at a Place of Payment for such
series, without charge to the Holder thereof, except as provided in Section 2.07 in connection with
a transfer. Upon surrender for cancellation of any one or more temporary Debt Securities of any
series, the Issuers shall execute and the Trustee shall authenticate and deliver in exchange
therefor a like principal amount of definitive Debt Securities of the same series of authorized
denominations and of like tenor. Until so exchanged, temporary Debt Securities of any series shall
in all respects be entitled to the same benefits under this Indenture as definitive Debt Securities
of such series.
Upon any exchange of a portion of a temporary Global Security for a definitive Global Security
or for the individual Debt Securities represented thereby pursuant to Section 2.07 or this Section
2.08, the temporary Global Security shall be endorsed by the Trustee to reflect the reduction of
the principal amount evidenced thereby, whereupon the principal amount of such temporary Global
Security shall be reduced for all purposes by the amount to be exchanged and endorsed.
Section 2.09 Mutilated, Destroyed, Lost or Stolen Debt Securities. If (a) any
mutilated Debt Security is surrendered to the Trustee at its corporate trust office or (b) the
Issuers and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of
any Debt Security, and there is delivered to the Issuers and the Trustee such security or indemnity
as may be required by them to save each of them and any paying agent harmless, and neither the
Issuers nor the Trustee receives notice that such Debt Security has been acquired by a protected
purchaser, then the Issuers shall execute and, upon an Issuer Order, the Trustee shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Debt
Security, a new Debt Security of the same series of like tenor, form, terms and principal amount,
bearing a number not contemporaneously Outstanding. Upon the issuance of any substituted Debt
Security, the Issuers or the Trustee may require the payment of a sum sufficient to cover any tax,
fee, assessment or other governmental charge that may be imposed in relation thereto and any other
expenses connected therewith. In case any Debt Security which has matured or is about to mature or
which has been called for redemption shall become mutilated or be destroyed, lost or stolen, the
Issuers may, instead of issuing a substituted Debt Security, pay or authorize the payment of the
same (without surrender thereof except in the case of a mutilated Debt Security) if the applicant
for such payment shall furnish the Issuers and the Trustee with such security or indemnity as
either may require to save it harmless from all risk, however remote, and, in case of destruction,
loss or theft, evidence to the satisfaction of the Issuers and the Trustee of the destruction, loss
or theft of such Debt Security and of the ownership thereof.
Every substituted Debt Security of any series issued pursuant to the provisions of this
Section 2.09 by virtue of the fact that any Debt Security is destroyed, lost or stolen shall
constitute an original additional contractual obligation of the Issuers, whether or not the
destroyed, lost or stolen Debt Security shall be found at any time, and shall be entitled to all
the benefits of this Indenture equally and proportionately with any and all other Debt Securities
of that series duly issued hereunder. All Debt Securities shall be held and owned upon the express
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condition that the foregoing provisions are exclusive with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Debt Securities, and shall preclude any and all
other rights or remedies, notwithstanding any law or statute existing or hereafter enacted to the
contrary with respect to the replacement or payment of negotiable instruments or other securities
without their surrender.
Section 2.10 Cancellation of Surrendered Debt Securities. All Debt Securities
surrendered for payment, redemption, registration of transfer or exchange shall, if surrendered to
an Issuer or any paying agent or a Registrar, be delivered to the Trustee for cancellation by it,
or if surrendered to the Trustee, shall be canceled by it, and no Debt Securities shall be issued
in lieu thereof except as expressly permitted by any of the provisions of this Indenture. All
canceled Debt Securities held by the Trustee shall be destroyed (subject to the record retention
requirements of the Exchange Act) and certification of their destruction delivered to the Issuers,
unless otherwise directed. On request of the Issuers, the Trustee shall deliver to the Issuers
canceled Debt Securities held by the Trustee. If either of the Issuers shall acquire any of the
Debt Securities, however, such acquisition shall not operate as a redemption or satisfaction of the
Debt represented thereby unless and until the same are delivered or surrendered to the Trustee for
cancellation. The Issuers may not issue new Debt Securities to replace Debt Securities it has
redeemed, paid or delivered to the Trustee for cancellation.
Section 2.11 Provisions of the Indenture and Debt Securities for the Sole Benefit of the
Parties and the Holders. Nothing in this Indenture or in the Debt Securities, expressed or
implied, shall give or be construed to give to any Person, other than the parties hereto, the
holders of any Senior Indebtedness, the Holders or any Registrar or paying agent, any legal or
equitable right, remedy or claim under or in respect of this Indenture, or under any covenant,
condition or provision herein contained; all its covenants, conditions and provisions being for the
sole benefit of the parties hereto, the Holders and any Registrar and paying agents.
Section 2.12 Payment of Interest; Interest Rights Preserved.
(a) Interest on any Debt Security that is payable and is punctually paid or duly provided for
on any interest payment date shall be paid to the Person in whose name such Debt Security is
registered at the close of business on the regular record date for such interest notwithstanding
the cancellation of such Debt Security upon any transfer or exchange subsequent to the regular
record date. Payment of interest on Debt Securities shall be made at the corporate trust office of
the Trustee (except as otherwise specified pursuant to Section 2.03), or at the option of the
Issuers, by check mailed to the address of the Person entitled thereto as such address shall appear
in the Debt Security Register or, if provided pursuant to Section 2.03 and in accordance with
arrangements satisfactory to the Trustee, at the option of the Holder by wire transfer to an
account designated by the Holder.
(b) Subject to the foregoing provisions of this Section 2.12 and Section 2.17, each Debt
Security of a particular series delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Debt Security of the same series shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other Debt Security.
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Section 2.13 Securities Denominated in Dollars. Except as otherwise specified
pursuant to Section 2.03 for Debt Securities of any series, payment of the principal of, and
premium, if any, and interest on, Debt Securities of such series will be made in Dollars.
Section 2.14 Wire Transfers. Notwithstanding any other provision to the contrary in
this Indenture, the Issuers may make any payment of moneys required to be deposited with the
Trustee on account of principal of, or premium, if any, or interest on, the Debt Securities
(whether pursuant to optional or mandatory redemption payments, interest payments or otherwise) by
wire transfer in immediately available funds to an account designated by the Trustee before 11:00
a.m., New York City time, on the date such moneys are to be paid to the Holders of the Debt
Securities in accordance with the terms hereof.
Section 2.15 Securities Issuable in the Form of a Global Security.
(a) If the Issuers shall establish pursuant to Sections 2.01 and 2.03 that the Debt Securities
of a particular series are to be issued in whole or in part in the form of one or more Global
Securities, then the Issuers shall execute and the Trustee or its agent shall, in accordance with
Section 2.05, authenticate and deliver, such Global Security or Securities, which shall represent,
and shall be denominated in an amount equal to the aggregate principal amount of, the Outstanding
Debt Securities of such series to be represented by such Global Security or Securities, or such
portion thereof as the Issuers shall specify in an Officers Certificate, shall be registered in
the name of the Depositary for such Global Security or Securities or its nominee, shall be
delivered by the Trustee or its agent to the Depositary or pursuant to the Depositarys instruction
and shall bear a legend substantially to the following effect:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (DTC), NEW YORK, NEW YORK, TO THE ISSUERS OR THEIR AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSORS NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO HEREIN.
or such other legend as may then be required by the Depositary for such Global Security or
Securities.
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(b) Notwithstanding any other provision of this Section 2.15 or of Section 2.07 to the
contrary, and subject to the provisions of paragraph (c) below, unless the terms of a Global
Security expressly permit such Global Security to be exchanged in whole or in part for definitive
Debt Securities in registered form, a Global Security may be transferred, in whole but not in part
and in the manner provided in Section 2.07, only by the Depositary to a nominee of the Depositary
for such Global Security, or by a nominee of the Depositary to the Depositary or another nominee of
the Depositary, or by the Depositary or a nominee of the Depositary to a successor Depositary for
such Global Security selected or approved by the Issuers, or to a nominee of such successor
Depositary.
(c) (i) If at any time the Depositary for a Global Security or Securities notifies the Issuers
that it is unwilling or unable to continue as Depositary for such Global Security or Securities or
if at any time the Depositary for the Debt Securities for such series shall no longer be eligible
or in good standing under the Exchange Act or other applicable statute, rule or regulation, the
Issuers shall appoint a successor Depositary with respect to such Global Security or Securities.
If a successor Depositary for such Global Security or Securities is not appointed by the Issuers
within 90 days after the Issuers receive such notice or becomes aware of such ineligibility, the
Issuers shall execute, and the Trustee or its agent, upon receipt of an Issuer Order for the
authentication and delivery of such individual Debt Securities of such series in exchange for such
Global Security or Securities, will authenticate and deliver, individual Debt Securities of such
series of like tenor and terms in definitive form in an aggregate principal amount equal to the
principal amount of the Global Security or Securities in exchange for such Global Security or
Securities.
(ii) If an Event of Default occurs and the Depositary for a Global Security or
Securities notifies the Trustee of its decision to require that the Debt Securities of any
series or portion thereof issued or issuable in the form of one or more Global Securities
shall no longer be represented by such Global Security or Securities, the Issuers shall
appoint a successor Depositary with respect to such Global Security or Securities. In such
event the Issuers will execute, and the Trustee, upon receipt of an Issuer Order for the
authentication and delivery of individual Debt Securities of such series in exchange in
whole or in part for such Global Security or Securities, will authenticate and deliver
individual Debt Securities of such series of like tenor and terms in definitive form in an
aggregate principal amount equal to the principal amount of such series or portion thereof
in exchange for such Global Security or Securities.
(iii) If specified by the Issuers pursuant to Sections 2.01 and 2.03 with respect to
Debt Securities issued or issuable in the form of a Global Security, the Depositary for such
Global Security may surrender such Global Security in exchange in whole or in part for
individual Debt Securities of such series of like tenor and terms in definitive form on such
terms as are acceptable to the Issuers, the Trustee and such Depositary. Thereupon the
Issuers shall execute, and the Trustee or its agent upon receipt of an Issuer Order for the
authentication and delivery of definitive Debt Securities of such series shall authenticate
and deliver, without service charge, to each Person specified by such Depositary a new Debt
Security or Securities of the same series of like tenor and terms and of any authorized
denomination as requested by such Person in aggregate principal amount equal to and in
exchange for such Persons beneficial interest in the Global
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Security; and to such Depositary a new Global Security of like tenor and terms and in
an authorized denomination equal to the difference, if any, between the principal amount of
the surrendered Global Security and the aggregate principal amount of Debt Securities
delivered to Holders thereof.
(iv) In any exchange provided for in any of the preceding three paragraphs, the Issuers
will execute and the Trustee or its agent will authenticate and deliver individual Debt
Securities. Upon the exchange of the entire principal amount of a Global Security for
individual Debt Securities, such Global Security shall be canceled by the Trustee or its
agent. Except as provided in the preceding paragraph, Debt Securities issued in exchange
for a Global Security pursuant to this Section 2.15 shall be registered in such names and in
such authorized denominations as the Depositary for such Global Security, pursuant to
instructions from its direct or indirect participants or otherwise, shall instruct the
Trustee or the Registrar. The Trustee or the Registrar shall deliver such Debt Securities
to the Persons in whose names such Debt Securities are so registered.
(v) Payments in respect of the principal of and interest on any Debt Securities
registered in the name of the Depositary or its nominee will be payable to the Depositary or
such nominee in its capacity as the registered owner of such Global Security. The Issuers,
any Subsidiary Guarantors and the Trustee may treat the Person in whose name the Debt
Securities, including the Global Security, are registered as the owner thereof for the
purpose of receiving such payments and for any and all other purposes whatsoever. None of
the Issuers, any Subsidiary Guarantors, the Trustee, any Registrar, the paying agent or any
agent of the Issuers, any Subsidiary Guarantors or the Trustee will have any responsibility
or liability for any aspect of the records relating to or payments made on account of the
beneficial ownership interests of the Global Security by the Depositary or its nominee or
any of the Depositarys direct or indirect participants, or for maintaining, supervising or
reviewing any records of the Depositary, its nominee or any of its direct or indirect
participants relating to the beneficial ownership interests of the Global Security, the
payments to the beneficial owners of the Global Security of amounts paid to the Depositary
or its nominee, or any other matter relating to the actions and practices of the
Depositary, its nominee or any of its direct or indirect participants. None of the Issuers,
any Subsidiary Guarantors, the Trustee or any such agent will be liable for any delay by the
Depositary, its nominee, or any of its direct or indirect participants in identifying the
beneficial owners of the Debt Securities, and the Issuers, any Subsidiary Guarantors and the
Trustee may conclusively rely on, and will be protected in relying on, instructions from the
Depositary or its nominee for all purposes (including with respect to the registration and
delivery, and the respective principal amounts, of the Debt Securities to be issued).
Section 2.16 Medium Term Securities. Notwithstanding any contrary provision herein,
if all Debt Securities of a series are not to be originally issued at one time, it shall not be
necessary for each of the Issuers to deliver to the Trustee an Officers Certificate, resolutions
of each such Issuers Board of Directors, supplemental Indenture, Opinion of Counsel or written
order or any other document otherwise required pursuant to Section 2.01, 2.03, 2.05 or 13.05 at or
prior to the time of authentication of each Debt Security of such series if such documents are
delivered to the Trustee or its agent at or prior to the authentication upon original issuance of
the
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first such Debt Security of such series to be issued; provided, that any subsequent request by
the Issuers to the Trustee to authenticate Debt Securities of such series upon original issuance
shall constitute a representation and warranty by the Issuers that, as of the date of such request,
the statements made in the Officers Certificate delivered pursuant to Section 2.05 or 13.05 shall
be true and correct as if made on such date and that the Opinion of Counsel delivered at or prior
to such time of authentication of an original issuance of Debt Securities shall specifically state
that it shall relate to all subsequent issuances of Debt Securities of such series that are
identical to the Debt Securities issued in the first issuance of Debt Securities of such series.
An Issuer Order delivered by the Issuers to the Trustee in the circumstances set forth in the
preceding paragraph, may provide that Debt Securities which are the subject thereof will be
authenticated and delivered by the Trustee or its agent on original issue from time to time upon
the telephonic or written order of Persons designated in such written order (any such telephonic
instructions to be promptly confirmed in writing by such Person) and that such Persons are
authorized to determine, consistent with the Officers Certificate, supplemental Indenture or
resolution of the Board of Directors relating to such written order, such terms and conditions of
such Debt Securities as are specified in such Officers Certificate, supplemental Indenture or such
resolution.
Section 2.17 Defaulted Interest. Any interest on any Debt Security of a particular
series which is payable, but is not punctually paid or duly provided for, on the dates and in the
manner provided in the Debt Securities of such series and in this Indenture (herein called
Defaulted Interest) shall forthwith cease to be payable to the Holder thereof on the relevant
record date by virtue of having been such Holder, and such Defaulted Interest may be paid by the
Issuers, at their election in each case, as provided in clause (i) or (ii) below:
(i) The Issuers may elect to make payment of any Defaulted Interest to the Persons in
whose names the Debt Securities of such series are registered at the close of business on a
special record date for the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Issuers shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each such Debt Security of such series and the
date of the proposed payment, and at the same time the Issuers shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such
deposit prior to the date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause
provided. Thereupon the Trustee shall fix a special record date for the payment of such
Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to
the date of the proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly notify the Issuers of
such special record date and, in the name and at the expense of the Issuers, shall cause
notice of the proposed payment of such Defaulted Interest and the special record date
therefor to be mailed, first class postage pre-paid, to each Holder thereof at its address
as it appears in the Debt Security Register, not less than 10 days prior to such special
record date. Notice of the proposed payment of such Defaulted Interest and the special
record date therefor having been so mailed, such
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Defaulted Interest shall be paid to the Persons in whose names the Debt Securities of
such series are registered at the close of business on such special record date.
(ii) The Issuers may make payment of any Defaulted Interest on the Debt Securities of
such series in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Debt Securities of such series may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the Issuers to the
Trustee of the proposed payment pursuant to this clause, such manner of payment shall be
deemed practicable by the Trustee.
Section 2.18 CUSIP Numbers. The Issuers in issuing the Debt Securities may use
CUSIP numbers (if then generally in use), and, if so, the Trustee shall use CUSIP numbers in
notices of redemption as a convenience to Holders; provided that any such notice may state that no
representation is made as to the accuracy of such numbers either as printed on the Debt Securities
or as contained in any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Debt Securities, and any such redemption shall not be
affected by any defect in or omission of such numbers. The Issuers will promptly notify the
Trustee in writing of any change in the CUSIP numbers.
ARTICLE III
REDEMPTION OF DEBT SECURITIES
Section 3.01 Applicability of Article. The provisions of this Article shall be
applicable to the Debt Securities of any series which are redeemable before their Stated Maturity
except as otherwise specified as contemplated by Section 2.03 for Debt Securities of such series.
Section 3.02 Notice of Redemption; Selection of Debt Securities. In case the Issuers
shall desire to exercise the right to redeem all or, as the case may be, any part of the Debt
Securities of any series in accordance with their terms, by resolution of the Board of Directors of
each Issuer or a supplemental Indenture, the Issuers shall fix a date for redemption and shall give
notice of such redemption at least 30 and not more than 60 days prior to the date fixed for
redemption to the Holders of Debt Securities of such series so to be redeemed as a whole or in
part, in the manner provided in Section 13.03. The notice if given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the Holder receives such
notice. In any case, failure to give such notice or any defect in the notice to the Holder of any
Debt Security of a series designated for redemption as a whole or in part shall not affect the
validity of the proceedings for the redemption of any other Debt Security of such series.
Each such notice of redemption shall specify (i) the date fixed for redemption, (ii) the
redemption price at which Debt Securities of such series are to be redeemed (or the method of
calculating such redemption price), (iii) the Place or Places of Payment that payment will be made
upon presentation and surrender of such Debt Securities, (iv) that any interest accrued to the date
fixed for redemption will be paid as specified in said notice, (v) that the redemption is for a
sinking fund payment (if applicable), (vi) that, unless otherwise specified in such notice, if the
Issuers default in making such redemption payment or if the Debt Securities of that series are
subordinated pursuant to the terms of Article XII, the paying agent is prohibited from making such
payment pursuant to the terms of this Indenture, (vii) that on and after said date any interest
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thereon or on the portions thereof to be redeemed will cease to accrue, (viii) that in the
case of Original Issue Discount Securities original issue discount accrued after the date fixed for
redemption will cease to accrue, (ix) the terms of the Debt Securities of that series pursuant to
which the Debt Securities of that series are being redeemed and (x) that no representation is made
as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on
the Debt Securities of that series. If less than all the Debt Securities of a series are to be
redeemed the notice of redemption shall specify the certificate numbers of any Debt Securities of
that series to be redeemed that are not in global form. In case any Debt Security of a series is
to be redeemed in part only, the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the date fixed for redemption, upon
surrender of such Debt Security, a new Debt Security or Debt Securities of that series in principal
amount equal to the unredeemed portion thereof, will be issued.
At least five days before the giving of any notice of redemption, unless the Trustee consents
to a shorter period, the Issuers shall give written notice to the Trustee of the Redemption Date,
the principal amount of Debt Securities to be redeemed and the series and terms of the Debt
Securities pursuant to which such redemption will occur. Such notice shall be accompanied by an
Officers Certificate and an Opinion of Counsel from the Issuers to the effect that such redemption
will comply with the conditions herein, and such notice may be revoked at any time prior to the
giving of a notice of redemption to the Holders pursuant to this Section 3.02. If fewer than all
the Debt Securities of a series are to be redeemed, the record date relating to such redemption
shall be selected by the Issuers and given in writing to the Trustee, which record date shall be
not less than three days after the date of notice to the Trustee.
By 11 a.m., New York City time, on the Redemption Date for any Debt Securities, the Issuers
shall deposit with the Trustee or with a paying agent (or, if an Issuer is acting as its own paying
agent, segregate and hold in trust) an amount of money in Dollars (except as provided pursuant to
Section 2.03) sufficient to pay the redemption price of such Debt Securities or any portions
thereof that are to be redeemed on that date, together with any interest accrued to the Redemption
Date.
If less than all the Debt Securities of like tenor and terms of a series are to be redeemed
(other than pursuant to mandatory sinking fund redemptions), the Trustee shall select, on a pro
rata basis, by lot or by such other method as in its sole discretion it shall deem appropriate and
fair, the Debt Securities of that series or portions thereof (in multiples of $1,000) to be
redeemed. In any case where more than one Debt Security of such series is registered in the same
name, the Trustee in its discretion may treat the aggregate principal amount so registered as if it
were represented by one Debt Security of such series. The Trustee shall promptly notify the
Issuers in writing of the Debt Securities selected for redemption and, in the case of any Debt
Securities selected for partial redemption, the principal amount thereof to be redeemed. If any
Debt Security called for redemption shall not be so paid upon surrender thereof on such Redemption
Date, the principal, premium, if any, and interest shall bear interest until paid from the
Redemption Date at the rate borne by the Debt Securities of that series. If less than all the Debt
Securities of unlike tenor and terms of a series are to be redeemed, the particular Debt Securities
to be redeemed shall be selected by the Issuers. Provisions of this Indenture that apply to Debt
Securities called for redemption also apply to portions of Debt Securities called for redemption.
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Section 3.03 Payment of Debt Securities Called for Redemption. If notice of
redemption has been given as provided in Section 3.02, the Debt Securities or portions of Debt
Securities of the series with respect to which such notice has been given shall become due and
payable on the date and at the Place or Places of Payment stated in such notice at the applicable
redemption price, together with any interest accrued to the date fixed for redemption, and on and
after said date (unless the Issuers shall default in the payment of such Debt Securities at the
applicable redemption price, together with any interest accrued to said date) any interest on the
Debt Securities or portions of Debt Securities of any series so called for redemption shall cease
to accrue, and any original issue discount in the case of Original Issue Discount Securities shall
cease to accrue. On presentation and surrender of such Debt Securities at the Place or Places of
Payment in said notice specified, the said Debt Securities or the specified portions thereof shall
be paid and redeemed by the Issuers at the applicable redemption price, together with any interest
accrued thereon to the date fixed for redemption.
Any Debt Security that is to be redeemed only in part shall be surrendered at the Place of
Payment with, if the Issuers, the Registrar or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Issuers, the Registrar and the Trustee
duly executed by, the Holder thereof or his attorney duly authorized in writing, and the Issuers
shall execute, and the Trustee shall authenticate and deliver to the Holder of such Debt Security
without service charge, a new Debt Security or Debt Securities of the same series, of like tenor
and form, of any authorized denomination as requested by such Holder in aggregate principal amount
equal to and in exchange for the unredeemed portion of the principal of the Debt Security so
surrendered; except that if a Global Security is so surrendered, the Issuers shall execute, and the
Trustee shall authenticate and deliver to the Depositary for such Global Security, without service
charge, a new Global Security in a denomination equal to and in exchange for the unredeemed portion
of the principal of the Global Security so surrendered. In the case of a Debt Security providing
appropriate space for such notation, at the option of the Holder thereof, the Trustee, in lieu of
delivering a new Debt Security or Debt Securities as aforesaid, may make a notation on such Debt
Security of the payment of the redeemed portion thereof.
Section 3.04 Mandatory and Optional Sinking Funds. The minimum amount of any sinking
fund payment provided for by the terms of Debt Securities of any series, resolution of the Board of
Directors or a supplemental Indenture is herein referred to as a mandatory sinking fund payment,
and any payment in excess of such minimum amount provided for by the terms of Debt Securities of
any series, resolution of the Board of Directors or a supplemental Indenture is herein referred to
as an optional sinking fund payment.
In lieu of making all or any part of any mandatory sinking fund payment with respect to any
Debt Securities of a series in cash, the Issuers may at their option (a) deliver to the Trustee
Debt Securities of that series theretofore purchased or otherwise acquired by the Issuers or (b)
receive credit for the principal amount of Debt Securities of that series which have been redeemed
either at the election of the Issuers pursuant to the terms of such Debt Securities or through the
application of permitted optional sinking fund payments pursuant to the terms of such Debt
Securities, resolution or supplemental Indenture; provided, that such Debt Securities have not been
previously so credited. Such Debt Securities shall be received and credited for such purpose by
the Trustee at the redemption price specified in such Debt Securities, resolution
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or supplemental Indenture for redemption through operation of the sinking fund and the amount
of such mandatory sinking fund payment shall be reduced accordingly.
Section 3.05 Redemption of Debt Securities for Sinking Fund. Not less than 60 days
prior to each sinking fund payment date for any series of Debt Securities, the Issuers will deliver
to the Trustee an Officers Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of that series, any resolution or supplemental
Indenture, the portion thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting Debt Securities of that
series pursuant to this Section 3.05 (which Debt Securities, if not previously redeemed, will
accompany such certificate) and whether the Issuers intend to exercise its right to make any
permitted optional sinking fund payment with respect to such series. Such certificate shall also
state that no Event of Default has occurred and is continuing with respect to such series. Such
certificate shall be irrevocable and upon its delivery the Issuers shall be obligated to make the
cash payment or payments therein referred to, if any, by 11 a.m., New York City time, on the next
succeeding sinking fund payment date. Failure of the Issuers to deliver such certificate (or to
deliver the Debt Securities specified in this paragraph) shall not constitute a Default, but such
failure shall require that the sinking fund payment due on the next succeeding sinking fund payment
date for that series shall be paid entirely in cash and shall be sufficient to redeem the principal
amount of such Debt Securities subject to a mandatory sinking fund payment without the option to
deliver or credit Debt Securities as provided in this Section 3.05 and without the right to make
any optional sinking fund payment, if any, with respect to such series.
Any sinking fund payment or payments (mandatory or optional) made in cash plus any unused
balance of any preceding sinking fund payments made in cash which shall equal or exceed $100,000
(or a lesser sum if the Issuers shall so request) with respect to the Debt Securities of any
particular series shall be applied by the Trustee on the sinking fund payment date on which such
payment is made (or, if such payment is made before a sinking fund payment date, on the sinking
fund payment date following the date of such payment) to the redemption of such Debt Securities at
the redemption price specified in such Debt Securities, resolution or supplemental Indenture for
operation of the sinking fund together with any accrued interest to the date fixed for redemption.
Any sinking fund moneys not so applied or allocated by the Trustee to the redemption of Debt
Securities shall be added to the next cash sinking fund payment received by the Trustee for such
series and, together with such payment, shall be applied in accordance with the provisions of this
Section 3.05. Any and all sinking fund moneys with respect to the Debt Securities of any
particular series held by the Trustee on the last sinking fund payment date with respect to Debt
Securities of such series and not held for the payment or redemption of particular Debt Securities
shall be applied by the Trustee, together with other moneys, if necessary, to be deposited
sufficient for the purpose, to the payment of the principal of the Debt Securities of that series
at its Stated Maturity.
The Trustee shall select the Debt Securities to be redeemed upon such sinking fund payment
date in the manner specified in the last paragraph of Section 3.02 and the Issuers shall cause
notice of the redemption thereof to be given in the manner provided in Section 3.02 except that the
notice of redemption shall also state that the Debt Securities are being redeemed by operation of
the sinking fund. Such notice having been duly given, the redemption of such Debt Securities shall
be made upon the terms and in the manner stated in Section 3.03.
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The Trustee shall not redeem any Debt Securities of a series with sinking fund moneys or mail
any notice of redemption of such Debt Securities by operation of the sinking fund for such series
during the continuance of a Default in payment of interest on such Debt Securities or of any Event
of Default (other than an Event of Default occurring as a consequence of this paragraph) with
respect to such Debt Securities, except that if the notice of redemption of any such Debt
Securities shall theretofore have been mailed in accordance with the provisions hereof, the Trustee
shall redeem such Debt Securities if cash sufficient for that purpose shall be deposited with the
Trustee for that purpose in accordance with the terms of this Article III. Except as aforesaid,
any moneys in the sinking fund for such series at the time when any such Default or Event of
Default shall occur and any moneys thereafter paid into such sinking fund shall, during the
continuance of such Default or Event of Default, be held as security for the payment of such Debt
Securities; provided, however, that in case such Default or Event of Default shall have been cured
or waived as provided herein, such moneys shall thereafter be applied on the next sinking fund
payment date for such Debt Securities on which such moneys may be applied pursuant to the
provisions of this Section 3.05.
ARTICLE IV
PARTICULAR COVENANTS OF THE ISSUERS
Section 4.01 Payment of Principal of, and Premium, If Any, and Interest on, Debt
Securities. The Issuers, for the benefit of each series of Debt Securities, will duly and
punctually pay or cause to be paid the principal of, and premium, if any, and interest on, each of
the Debt Securities at the place, at the respective times and in the manner provided herein or in
the Debt Securities. Each installment of interest on any Debt Securities not in global form may at
the Issuers option be paid by mailing checks for such interest payable to the Person entitled
thereto pursuant to Section 2.07(a) to the address of such Person as it appears on the Debt
Security Register.
Principal of and premium and interest on Debt Securities of any series shall be considered
paid on the date due if, by 11 a.m., New York City time, on such date the Trustee or any paying
agent holds in accordance with this Indenture money sufficient to pay all principal, premium and
interest then due and, in the case of Debt Securities subordinated pursuant to the terms of Article
XII, the Trustee or such paying agent, as the case may be, is not prohibited from paying such money
to the Holders on that date pursuant to the terms of this Indenture.
The Issuers shall pay interest on overdue principal or premium, if any, at the rate specified
therefor in the Debt Securities, and it shall pay interest on overdue installments of interest at
the same rate to the extent lawful.
Section 4.02 Maintenance of Offices or Agencies for Registration of Transfer, Exchange and
Payment of Debt Securities. The Issuers will maintain in each Place of Payment for any series
of Debt Securities an office or agency where Debt Securities of such series may be presented or
surrendered for payment, and it shall also maintain (in or outside such Place of Payment) an office
or agency where Debt Securities of such series may be surrendered for transfer or exchange and
where notices and demands to or upon the Issuers in respect of the Debt Securities of such series
and this Indenture may be served. The Issuers will give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If
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at any time the Issuers shall fail to maintain any such required office or agency or shall
fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the office of the Trustee where its corporate trust business is
principally administered in the United States, and the Issuers hereby appoint the Trustee as their
agent to receive all presentations, surrenders, notices and demands.
The Issuers may also from time to time designate different or additional offices or agencies
to be maintained for such purposes (in or outside of such Place of Payment), and may from time to
time rescind any such designation; provided, however, that no such designation or rescission shall
in any manner relieve the Issuers of their obligations described in the preceding paragraph. The
Issuers will give prompt written notice to the Trustee of any such additional designation or
rescission of designation and any change in the location of any such different or additional office
or agency.
Section 4.03 Appointment to Fill a Vacancy in the Office of Trustee. The Issuers,
whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner
provided in Section 7.08, a Trustee, so that there shall at all times be a Trustee hereunder with
respect to each series of Debt Securities.
Section 4.04 Duties of Paying Agents, etc.
(a) The Issuers shall cause each paying agent, if any, other than the Trustee, to execute and
deliver to the Trustee an instrument in which such agent shall agree with the Trustee, subject to
the provisions of this Section 4.04,
(i) that it will hold all sums held by it as such agent for the payment of the
principal of, and premium, if any, or interest on, the Debt Securities of any series
(whether such sums have been paid to it by the Issuers or by any other obligor on the Debt
Securities of such series) in trust for the benefit of the Holders of the Debt Securities of
such series;
(ii) that it will give the Trustee notice of any failure by the Issuers (or by any
other obligor on the Debt Securities of such series) to make any payment of the principal
of, and premium, if any, or interest on, the Debt Securities of such series when the same
shall be due and payable; and
(iii) that it will at any time during the continuance of an Event of Default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held by it as such
agent.
(b) If either of the Issuers shall act as its own paying agent, it will, on or before each due
date of the principal of, and premium, if any, or interest on, the Debt Securities of any series,
set aside, segregate and hold in trust for the benefit of the Holders of the Debt Securities of
such series a sum sufficient to pay such principal, premium, if any, or interest so becoming due.
The Issuers will promptly notify the Trustee of any failure by either of the Issuers to take such
action or the failure by any other obligor on such Debt Securities to make any payment of the
principal of, and premium, if any, or interest on, such Debt Securities when the same shall be due
and payable.
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(c) Anything in this Section 4.04 to the contrary notwithstanding, either of the Issuers may,
at any time, for the purpose of obtaining a satisfaction and discharge of this Indenture, or for
any other reason, pay or cause to be paid to the Trustee all sums held in trust by it or any paying
agent, as required by this Section 4.04, such sums to be held by the Trustee upon the same trusts
as those upon which such sums were held by such Issuer or such paying agent.
(d) Whenever the Issuers shall have one or more paying agents with respect to any series of
Debt Securities, they will, prior to each due date of the principal of, and premium, if any, or
interest on, any Debt Securities of such series, deposit with any such paying agent a sum
sufficient to pay the principal, premium or interest so becoming due, such sum to be held in trust
for the benefit of the Persons entitled thereto, and (unless any such paying agent is the Trustee)
the Issuers will promptly notify the Trustee of its action or failure so to act.
(e) Anything in this Section 4.04 to the contrary notwithstanding, the agreement to hold sums
in trust as provided in this Section 4.04 is subject to the provisions of Section 11.05.
Section 4.05 SEC Reports; Financial Statements.
(a) The Partnership shall, so long as any of the Debt Securities are Outstanding, file with
the Trustee, within 30 days after it files the same with the SEC, copies of the annual reports and
the information, documents and other reports (or copies of such portions of any of the foregoing as
the SEC may by rules and regulations prescribe) that the Partnership is required to file with the
SEC pursuant to Section 13 or 15(d) of the Exchange Act. If the Partnership is not subject to the
requirements of such Section 13 or 15(d), the Partnership shall file with the Trustee, within 30
days after it would have been required to file the same with the SEC, financial statements,
including any notes thereto (and with respect to annual reports, an auditors report by a firm of
established national reputation), and a Managements Discussion and Analysis of Financial
Condition and Results of Operations, both comparable to that which the Partnership would have been
required to include in such annual reports, information, documents or other reports if the
Partnership had been subject to the requirements of such Section 13 or 15 (d). The Issuers shall
also comply with the provisions of TIA Section 314 (a).
(b) The Partnership shall provide the Trustee with a sufficient number of copies of all
reports and other documents and information that the Trustee may be required to deliver to Holders
under this Section.
(c) The Partnership shall, so long as any of the Notes are Outstanding, deliver to the
Trustee, within 30 days of any Officer of the Partnership becoming aware of the occurrence of any
Event of Default, an Officers Certificate specifying such Event of Default and what action the
Partnership is taking or proposes to take with respect thereto.
Section 4.06 Compliance Certificate.
(a) Each of the Issuers and any Subsidiary Guarantor shall, so long as any of the Debt
Securities are Outstanding, deliver to the Trustee, within 120 days after the end of each fiscal
year of the Partnership, an Officers Certificate stating that a review of the activities of the
Partnership and its Subsidiaries during the preceding fiscal year has been made under the
supervision of the Officers signing the certificate with a view to determining whether each of the
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Issuers and any Subsidiary Guarantor has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer signing such
certificate, that to the best of his knowledge each of the Issuers and any Subsidiary Guarantor has
kept, observed, performed and fulfilled each and every covenant contained in this Indenture and is
not in default in the performance or observance of any of the terms, provisions and conditions
hereof, without regard to any grace period or requirement of notice required by this Indenture (or,
if a Default or Event of Default shall have occurred, describing all such Defaults or Events of
Default of which such Officer may have knowledge and what action the Issuers or any Subsidiary
Guarantor is taking or proposes to take with respect thereto) and that to the best of his knowledge
no event has occurred and remains in existence by reason of which payments on account of the
principal of, or premium, if any, or interest, if any, on the Debt Securities are prohibited or, if
such event has occurred, a description of the event and what action the Partnership or any
Subsidiary Guarantor is taking or proposes to take with respect thereto.
(b) The Partnership shall, so long as any of the Debt Securities are Outstanding, deliver to
the Trustee within 30 days after the occurrence of any Default or Event of Default under this
Indenture, an Officers Certificate specifying such Default or Event of Default, the status thereof
and what action the Partnership is taking or proposes to take with respect thereto.
Section 4.07 Further Instruments and Acts. The Partnership will, upon request of the
Trustee, execute and deliver such further instruments and do such further acts as may reasonably be
necessary or proper to carry out more effectually the purposes of this Indenture.
Section 4.08 Existence. Except as permitted by Article X hereof, the Partnership
shall do or cause to be done all things necessary to preserve and keep in full force and effect its
existence and all rights (charter and statutory) and franchises of the Partnership, provided that
the Partnership shall not be required to preserve any such right or franchise, if its Board of
Directors shall determine that the preservation thereof is no longer desirable in the conduct of
the business of the Partnership.
Section 4.09 Maintenance of Properties. The Partnership shall cause all properties
owned by the Partnership or any of its Subsidiaries or used or held for use in the conduct of its
business or the business of any such Subsidiary to be maintained and kept in good condition, repair
and working order (reasonable wear and tear excepted) and supplied with all necessary equipment and
will cause to be made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the judgment of the Partnership may be necessary so that the business carried on
in connection therewith may be properly and advantageously conducted at all times; provided that
nothing in this Section shall prevent the Partnership from discontinuing the operation or
maintenance of any of such properties if such discontinuance is, in the judgment of the
Partnership, desirable in the conduct of its business or the business of any such Subsidiary and
not disadvantageous in any material respect to the Holders.
Section 4.10 Payment of Taxes and Other Claims. The Partnership shall pay or
discharge or cause to be paid or discharged, before the same shall become delinquent, (i) all
taxes, assessments and governmental charges levied or imposed upon the Partnership or any of its
Subsidiaries or upon the income, profits or property of the Partnership or any of its Subsidiaries,
and (ii) all lawful claims for labor, materials and supplies which, if unpaid, might
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by law become a Lien upon the property of the Partnership or any of its Subsidiaries; provided
that the Partnership shall not be required to pay or discharge or cause to be paid or discharged
any such tax, assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings.
Section 4.11 Waiver of Certain Covenants. The Issuers and the Subsidiary Guarantors
may, with respect to the Debt Securities of any series, omit in any particular instance to comply
with any covenant set forth in this Article IV (except Sections 4.01 through 4.08) or made
applicable to such Debt Securities pursuant to Section 2.03, if, before or after the time for such
compliance, the Holders of at least a majority in principal amount of the Outstanding Debt
Securities of each series affected, waive such compliance in such instance with such covenant, but
no such waiver shall extend to or affect such covenant except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Issuers and the Subsidiary
Guarantors and the duties of the Trustee in respect of any such covenant shall remain in full force
and effect.
ARTICLE V
HOLDERS LISTS AND REPORTS BY THE TRUSTEE
Section 5.01 Issuers to Furnish Trustee Information as to Names and Addresses of Holders;
Preservation of Information. The Issuers covenant and agree that they will furnish or cause to
be furnished to the Trustee with respect to the Debt Securities of each series:
(a) not more than 10 days after each record date with respect to the payment of interest, if
any, a list, in such form as the Trustee may reasonably require, of the names and addresses of the
Holders as of such record date, and
(b) at such other times as the Trustee may request in writing, within 30 days after the
receipt by the Issuers of any such request, a list of similar form and contents as of a date not
more than 15 days prior to the time such list is furnished;
provided, however, that so long as the Trustee shall be the Registrar, such lists shall not be
required to be furnished.
The Trustee shall preserve, in as current a form as is reasonably practicable, all information
as to the names and addresses of the Holders (i) contained in the most recent list furnished to it
as provided in this Section 5.01 or (ii) received by it in the capacity of paying agent or
Registrar (if so acting) hereunder.
The Trustee may destroy any list furnished to it as provided in this Section 5.01 upon receipt
of a new list so furnished.
Section 5.02 Communications to Holders. Holders may communicate pursuant to Section
312(b) of the TIA with other Holders with respect to their rights under this Indenture or the Debt
Securities. The Issuers, the Trustee, the Registrar and anyone else shall have the protection of
Section 312(c) of the TIA.
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Section 5.03 Reports by Trustee. Within 60 days after each January 31, beginning with
the first January 31 following the date of this Indenture, and in any event on or before April 1 in
each year, the Trustee shall mail to Holders a brief report dated as of such January 31 that
complies with TIA Section 313 (a); provided, however, that if no event described in TIA Section 313
(a) has occurred within the twelve months preceding the reporting date, no report need be
transmitted. The Trustee also shall comply with TIA Section 313 (b).
Reports pursuant to this Section 5.03 shall be transmitted by mail:
(a) to all Holders, as the names and addresses of such Holders appear in the Debt Security
Register; and
(b) except in the cases of reports under Section 313(b)(2) of the TIA, to each Holder of a
Debt Security of any series whose name and address appear in the information preserved at the time
by the Trustee in accordance with Section 5.01.
A copy of each report at the time of its mailing to Holders shall be filed with the Securities
and Exchange Commission and each stock exchange (if any) on which the Debt Securities of any series
are listed. The Issuers agree to notify promptly the Trustee whenever the Debt Securities of any
series become listed on any stock exchange and of any delisting thereof.
Section 5.04 Record Dates for Action by Holders. If the Issuers shall solicit from
the Holders of Debt Securities of any series any action (including the making of any demand or
request, the giving of any direction, notice, consent or waiver or the taking of any other action),
the Issuers may, at their option, by resolution of their respective Boards of Directors, fix in
advance a record date for the determination of Holders of Debt Securities entitled to take such
action, but the Issuers shall have no obligation to do so. Any such record date shall be fixed at
the Issuers discretion. If such a record date is fixed, such action may be sought or given before
or after the record date, but only the Holders of Debt Securities of record at the close of
business on such record date shall be deemed to be Holders of Debt Securities for the purpose of
determining whether Holders of the requisite proportion of Debt Securities of such series
Outstanding have authorized or agreed or consented to such action, and for that purpose the Debt
Securities of such series Outstanding shall be computed as of such record date.
ARTICLE VI
REMEDIES OF THE TRUSTEE AND HOLDERS IN EVENT OF DEFAULT
Section 6.01 Events of Default. If any one or more of the following shall have
occurred and be continuing with respect to Debt Securities of any series (each of the following, an
Event of Default):
(a) default in the payment of any installment of interest upon any Debt Securities of that
series as and when the same shall become due and payable, whether or not such payment shall be
prohibited by Article XII, if applicable, and continuance of such default for a period of 30 days;
or
(b) default in the payment of the principal of or premium, if any, on any Debt Securities of
that series as and when the same shall become due and payable, whether at Stated
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Maturity, upon redemption, by declaration, upon required repurchase or otherwise, whether or
not such payment shall be prohibited by Article XII, if applicable; or
(c) default in the payment of any sinking fund payment with respect to any Debt Securities of
that series as and when the same shall become due and payable; or
(d) failure on the part of the Issuers, or if any series of Debt Securities Outstanding under
this Indenture is entitled to the benefits of the Guarantee, any of the Subsidiary Guarantors, duly
to observe or perform any other of the covenants or agreements on the part of the Issuers, or if
applicable, any of the Subsidiary Guarantors, in the Debt Securities of that series, in any
resolution of the Board of Directors authorizing the issuance of that series of Debt Securities, in
this Indenture with respect to such series or in any supplemental Indenture with respect to such
series (other than a covenant a default in the performance of which is elsewhere in this Section
specifically dealt with), continuing for a period of 60 days after the date on which written notice
specifying such failure and requiring the Issuers, or if applicable, the Subsidiary Guarantors, to
remedy the same shall have been given to the Issuers, or if applicable, the Subsidiary Guarantors,
by the Trustee or to the Issuers, or if applicable, the Subsidiary Guarantors, and the Trustee by
the Holders of at least 25% in aggregate principal amount of the Debt Securities of that series at
the time Outstanding; or
(e) either of the Issuers, or if any series of Debt Securities Outstanding under this
Indenture is entitled to the benefits of the Guarantee, any of the Subsidiary Guarantors, pursuant
to or within the meaning of any Bankruptcy Law,
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an involuntary case,
(iii) consents to the appointment of a Custodian of it or for all or substantially all
of its property; or
(iv) makes a general assignment for the benefit of its creditors;
(f) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against either of the Issuers, or if any series of Debt Securities
Outstanding under this Indenture is entitled to the benefits of the Guarantee, any of the
Subsidiary Guarantors, as debtor in an involuntary case,
(ii) appoints a Custodian of either of the Issuers, or if any series of Debt Securities
Outstanding under this Indenture is entitled to the benefits of the Guarantee, any of the
Subsidiary Guarantors, or a Custodian for all or substantially all of the property of either
of the Issuers, or if applicable, any of the Subsidiary Guarantors, or
(iii) orders the liquidation of either of the Issuers, or if any series of Debt
Securities Outstanding under this Indenture is entitled to the benefits of the Guarantee,
any of the Subsidiary Guarantors,
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and the order or decree remains unstayed and in effect for 60 days;
(g) if any series of Debt Securities Outstanding under this Indenture is entitled to the
benefits of the Guarantee, the Guarantee of any of the Subsidiary Guarantors ceases to be in full
force and effect with respect to Debt Securities of that series (except as otherwise provided in
this Indenture) or is declared null and void in a judicial proceeding or any of the Subsidiary
Guarantors denies or disaffirms its obligations under this Indenture or such Guarantee; or
(h) any other Event of Default provided with respect to Debt Securities of that series;
then and in each and every case that an Event of Default described in clause (a), (b), (c), (d),
(g), or (h) with respect to Debt Securities of that series at the time Outstanding occurs and is
continuing, unless the principal of, premium, if any, and accrued and unpaid interest on all the
Debt Securities of that series shall have already become due and payable, either the Trustee or the
Holders of not less than 25% in aggregate principal amount of the Debt Securities of that series
then Outstanding hereunder, by notice in writing to the Issuers (and to the Trustee if given by
Holders), may declare the principal of (or, if the Debt Securities of that series are Original
Issue Discount Debt Securities, such portion of the principal amount as may be specified in the
terms of that series), premium, if any, and interest on all the Debt Securities of that series to
be due and payable immediately, and upon any such declaration the same shall become and shall be
immediately due and payable, anything in this Indenture or in the Debt Securities of that series
contained to the contrary notwithstanding. If an Event of Default described in clause (e) or (f)
occurs with respect to either of the Issuers, then and in each and every such case, unless the
principal of and accrued and unpaid interest on all the Debt Securities shall have become due and
payable, the principal of (or, if the Debt Securities of that series are Original Issue Discount
Debt Securities, such portion of the principal amount as may be specified in the terms thereof),
premium, if any, and interest on all the Debt Securities then Outstanding hereunder shall ipso
facto become and be immediately due and payable without any declaration or other act on the part of
the Trustee or any Holders, anything in this Indenture or in the Debt Securities contained to the
contrary notwithstanding.
The Holders of a majority in aggregate principal amount of the Debt Securities of a particular
series by written notice to the Trustee may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree of a court of competent jurisdiction
already rendered and if all existing Events of Default with respect to that series have been cured
or waived except nonpayment of principal, premium, if any, or interest that has become due solely
because of acceleration. Upon any such rescission, the parties hereto shall be restored
respectively to their several positions and rights hereunder, and all rights, remedies and powers
of the parties hereto shall continue as though no such proceeding had been taken.
Section 6.02 Collection of Debt by Trustee, etc. If an Event of Default occurs and is
continuing, the Trustee, in its own name and as trustee of an express trust, shall be entitled and
empowered to institute any action or proceedings at law or in equity for the collection of the sums
so due and unpaid or enforce the performance of any provision of the Debt Securities of the
affected series or this Indenture, and may prosecute any such action or proceedings to judgment or
final decree, and may enforce any such judgment or final decree against any of the Subsidiary
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Guarantors or the Issuers or any other obligor upon the Debt Securities of such series (and
collect in the manner provided by law out of the property of any of the Subsidiary Guarantors or
the Issuers or any other obligor upon the Debt Securities of such series wherever situated the
moneys adjudged or decreed to be payable).
In case there shall be pending proceedings for the bankruptcy or for the reorganization of any
of the Subsidiary Guarantors or the Issuers or any other obligor upon the Debt Securities of any
series under any Bankruptcy Law, or in case a Custodian shall have been appointed for its property,
or in case of any other similar judicial proceedings relative to any of the Subsidiary Guarantors
or the Issuers or any other obligor upon the Debt Securities of any series, its creditors or its
property, the Trustee, irrespective of whether the principal of Debt Securities of any series shall
then be due and payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand pursuant to the provisions of this Section 6.02,
shall be entitled and empowered, by intervention in such proceedings or otherwise, to file and
prove a claim or claims for the whole amount of principal, premium, if any, and interest (or, if
the Debt Securities of such series are Original Issue Discount Debt Securities, such portion of the
principal amount as may be specified in the terms of such series) owing and unpaid in respect of
the Debt Securities of such series, and to file such other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee (including any claim for reasonable
compensation to the Trustee, its agents, attorneys and counsel, and for reimbursement of all
expenses and liabilities incurred, and all advances made, by the Trustee except as a result of its
negligence or bad faith) and of the Holders thereof allowed in any such judicial proceedings
relative to any of the Subsidiary Guarantors or the Issuers, or any other obligor upon the Debt
Securities of such series, its creditors or its property, and to collect and receive any moneys or
other property payable or deliverable on any such claims, and to distribute all amounts received
with respect to the claims of such Holders and of the Trustee on their behalf, and any receiver,
assignee or trustee in bankruptcy or reorganization is hereby authorized by each of such Holders to
make payments to the Trustee, and, in the event that the Trustee shall consent to the making of
payments directly to such Holders, to pay to the Trustee such amount as shall be sufficient to
cover reasonable compensation to the Trustee, its agents, attorneys and counsel, and all other
reasonable expenses and liabilities incurred, and all advances made, by the Trustee except as a
result of its negligence or bad faith.
All rights of action and of asserting claims under this Indenture, or under any of the Debt
Securities of any series, may be enforced by the Trustee without the possession of any such Debt
Securities, or the production thereof in any trial or other proceedings relative thereto, and any
such action or proceedings instituted by the Trustee shall be brought in its own name as trustee of
an express trust, and any recovery of judgment (except for any amounts payable to the Trustee
pursuant to Section 7.06) shall be for the ratable benefit of the Holders of all the Debt
Securities in respect of which such action was taken.
In case of an Event of Default hereunder the Trustee may in its discretion proceed to protect
and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as
the Trustee shall deem most effectual to protect and enforce any of such rights, either at law or
in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
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granted in this Indenture, or to enforce any other legal or equitable right vested in the
Trustee by this Indenture or by law.
Section 6.03 Application of Moneys Collected by Trustee. Any moneys or other property
collected by the Trustee pursuant to Section 6.02 with respect to Debt Securities of any series
shall be applied, after giving effect to the provisions of Article XII, if applicable, in the order
following, at the date or dates fixed by the Trustee for the distribution of such moneys or other
property, upon presentation of the several Debt Securities of such series in respect of which
moneys or other property have been collected, and the notation thereon of the payment, if only
partially paid, and upon surrender thereof if fully paid:
FIRST: To the payment of all money due the Trustee pursuant to Section 7.06;
SECOND: In case the principal of the Outstanding Debt Securities in respect of which such
moneys have been collected shall not have become due, to the payment of interest on the Debt
Securities of such series in the order of the maturity of the installments of such interest, with
interest (to the extent that such interest has been collected by the Trustee) upon the overdue
installments of interest at the rate or Yield to Maturity (in the case of Original Issue Discount
Debt Securities) borne by the Debt Securities of such series, such payments to be made ratably to
the Persons entitled thereto, without discrimination or preference;
THIRD: In case the principal of the Outstanding Debt Securities in respect of which such
moneys have been collected shall have become due, by declaration or otherwise, to the payment of
the whole amount then owing and unpaid upon the Debt Securities of such series for principal and
premium, if any, and interest, with interest on the overdue principal and premium, if any, and (to
the extent that such interest has been collected by the Trustee) upon overdue installments of
interest at the rate or Yield to Maturity (in the case of Original Issue Discount Debt Securities)
borne by the Debt Securities of such series; and, in case such moneys shall be insufficient to pay
in full the whole amount so due and unpaid upon the Debt Securities of such series, then to the
payment of such principal and premium, if any, and interest, without preference or priority of
principal and premium, if any, over interest, or of interest over principal and premium, if any, or
of any installment of interest over any other installment of interest, or of any Debt Security of
such series over any Debt Security of such series, ratably to the aggregate of such principal and
premium, if any, and interest; and
FOURTH: The remainder, if any, shall be paid to the Subsidiary Guarantors or the Issuers, as
applicable, or to whomsoever may be lawfully entitled to receive the same, or as a court of
competent jurisdiction may direct.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this
Section 6.03. At least 15 days before such record date, the Issuers shall mail to each Holder and
the Trustee a notice that states the record date, the payment date and amount to be paid.
Section 6.04 Limitation on Suits by Holders. No Holder of any Debt Security of any
series shall have any right by virtue or by availing of any provision of this Indenture to
institute any action or proceeding at law or in equity or in bankruptcy or otherwise, upon or under
or with
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respect to this Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless such Holder previously shall have given to the Trustee written notice of
an Event of Default with respect to Debt Securities of that same series and of the continuance
thereof and unless the Holders of not less than 25% in aggregate principal amount of the
Outstanding Debt Securities of that series shall have made written request upon the Trustee to
institute such action or proceedings in respect of such Event of Default in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable indemnity or security as it may
require against the costs, expenses and liabilities to be incurred therein or thereby, and the
Trustee, for 60 days after its receipt of such notice, request and offer of indemnity or security
shall have failed to institute any such action or proceedings and no direction inconsistent with
such written request shall have been given to the Trustee pursuant to Section 6.06; it being
understood and intended, and being expressly covenanted by the Holder of every Debt Security with
every other Holder and the Trustee, that no one or more Holders shall have any right in any manner
whatever by virtue or by availing of any provision of this Indenture to affect, disturb or
prejudice the rights of any Holders, or to obtain or seek to obtain priority over or preference to
any other such Holder, or to enforce any right under this Indenture, except in the manner herein
provided and for the equal, ratable and common benefit of all such Holders. For the protection and
enforcement of the provisions of this Section 6.04, each and every Holder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
Notwithstanding any other provision in this Indenture, however, the right of any Holder of any
Debt Security to receive payment of the principal of, and premium, if any, and (subject to Section
2.12) interest on, such Debt Security, on or after the respective due dates expressed in such Debt
Security, and to institute suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
Section 6.05 Remedies Cumulative; Delay or Omission in Exercise of Rights Not a Waiver of
Default. All powers and remedies given by this Article VI to the Trustee or to the Holders
shall, to the extent permitted by law, be deemed cumulative and not exclusive of any thereof or of
any other powers and remedies available to the Trustee or the Holders, by judicial proceedings or
otherwise, to enforce the performance or observance of the covenants and agreements contained in
this Indenture, and no delay or omission of the Trustee or of any Holder to exercise any right or
power accruing upon any Default occurring and continuing as aforesaid, shall impair any such right
or power, or shall be construed to be a waiver of any such Default or an acquiescence therein; and,
subject to the provisions of Section 6.04, every power and remedy given by this Article VI or by
law to the Trustee or to the Holders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Holders.
Section 6.06 Rights of Holders of Majority in Principal Amount of Debt Securities to
Direct Trustee and to Waive Default. The Holders of not less than a majority in aggregate
principal amount of the Debt Securities of any series at the time Outstanding shall have the right
to direct the time, method and place of conducting any proceeding for any remedy available to the
Trustee, or of exercising any right, trust or power conferred on the Trustee, with respect to the
Debt Securities of such series; provided, however, that such direction shall not be otherwise than
in accordance with law and the provisions of this Indenture, and that subject to the provisions of
Section 7.01, the Trustee shall have the right to decline to follow any such direction if the
Trustee being advised by counsel shall determine that the action so directed may not
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lawfully be taken or is inconsistent with any provision of this Indenture, or if the Trustee
shall by a responsible officer or officers determine that the action so directed would involve it
in personal liability or would be unduly prejudicial to Holders of Debt Securities of such series
not taking part in such direction; and provided, further, however, that nothing in this Indenture
contained shall impair the right of the Trustee to take any action deemed proper by the Trustee and
which is not inconsistent with such direction by such Holders. The Holders of not less than a
majority in aggregate principal amount of the Debt Securities of any series at the time Outstanding
may on behalf of the Holders of all the Debt Securities of that series waive any past Default or
Event of Default and its consequences for that series, except a Default or Event of Default in the
payment of the principal of, and premium, if any, or interest on, any of the Debt Securities and a
Default or Event of Default in respect of a provision that under Section 9.02 cannot be amended
without the consent of each Holder affected thereby. In case of any such waiver, such Default
shall cease to exist, any Event of Default arising therefrom shall be deemed to have been cured for
every purpose of this Indenture, and the Subsidiary Guarantors, the Issuers, the Trustee and the
Holders of the Debt Securities of that series shall be restored to their former positions and
rights hereunder, respectively; but no such waiver shall extend to any subsequent or other Default
or Event of Default or impair any right consequent thereon.
Section 6.07 Trustee to Give Notice of Events of Defaults Known to It, but May Withhold
Such Notice in Certain Circumstances. The Trustee shall, within 90 days after the occurrence
of an Event of Default, or if later, within 30 days after the Trustee obtains actual knowledge of
the Event of Default, with respect to a series of Debt Securities give to the Holders thereof, in
the manner provided in Section 13.03, notice of all Events of Default with respect to such series
known to the Trustee, unless such Events of Default shall have been cured or waived before the
giving of such notice; provided, that, except in the case of an Event of Default in the payment of
the principal of, or premium, if any, or interest on, any of the Debt Securities of such series or
in the making of any sinking fund payment with respect to the Debt Securities of such series, the
Trustee shall be protected in withholding such notice if and so long as the board of directors, the
executive committee or a committee of directors or responsible officers of the Trustee in good
faith determines that the withholding of such notice is in the interests of the Holders thereof.
Section 6.08 Requirement of an Undertaking to Pay Costs in Certain Suits under the
Indenture or Against the Trustee. All parties to this Indenture agree, and each Holder of any
Debt Security by his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or
in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit in the manner and to
the extent provided in the TIA, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 6.08 shall not apply to any suit instituted by the Trustee, to any
suit instituted by any Holder, or group of Holders, holding in the aggregate more than 25 percent
in principal amount of the Outstanding Debt Securities of that series or to any suit instituted by
any Holder for the enforcement of the payment of the principal of, or premium, if any, or interest
on, any Debt Security on or after the due date for such payment expressed in such Debt Security.
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ARTICLE VII
CONCERNING THE TRUSTEE
Section 7.01 Certain Duties and Responsibilities. The Trustee, prior to the
occurrence of an Event of Default and after the curing or waiving of all Events of Default which
may have occurred, undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture. In case an Event of Default has occurred (which has not been cured or
waived), the Trustee shall exercise such of the rights and powers vested in it by this Indenture,
and use the same degree of care and skill in their exercise, as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the Trustee from liability for
its own negligent action, its own negligent failure to act, its own bad faith or its own willful
misconduct, except that:
(a) this paragraph shall not be construed to limit the effect of the first paragraph of this
Section 7.01;
(b) prior to the occurrence of an Event of Default with respect to the Debt Securities of a
series and after the curing or waiving of all Events of Default with respect to such series which
may have occurred:
(i) the duties and obligations of the Trustee with respect to Debt Securities of any
series shall be determined solely by the express provisions of this Indenture, and the
Trustee shall not be liable except for the performance of such duties and obligations with
respect to such series as are specifically set forth in this Indenture, and no implied
covenants or obligations with respect to such series shall be read into this Indenture
against the Trustee;
(ii) in the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture; but in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether or not they conform
to the requirements of this Indenture; but the Trustee shall examine the evidence furnished
to it pursuant to Sections 4.05 and 4.06 to determine whether or not such evidence conforms
to the requirement of this Indenture;
(iii) the Trustee shall not be liable for an error of judgment made in good faith by a
responsible officer, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(iv) the Trustee shall not be liable with respect to any action taken or omitted to be
taken by it with respect to Debt Securities of any series in good faith in accordance with
the direction of the Holders of not less than a majority in aggregate principal amount of
the Outstanding Debt Securities of that series relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising any
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trust or power conferred upon the Trustee, under this Indenture with respect to Debt
Securities of such series.
None of the provisions of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any personal financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there shall be reasonable grounds
for believing that repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
Whether or not therein expressly so provided, every provision of this Indenture relating to
the conduct or affecting the liability of or affording protection to the Trustee shall be subject
to the provisions of this Section.
Section 7.02 Certain Rights of Trustee. Except as otherwise provided in Section 7.01:
(a) the Trustee may rely and shall be protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note or other paper or document (whether in its original or
facsimile form) believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) any request, direction, order or demand of either of the Issuers mentioned herein shall be
sufficiently; evidenced by an Issuer Order (unless other evidence in respect thereof be herein
specifically prescribed); and any resolution of the Board of Directors of an Issuer may be
evidenced to the Trustee by a copy thereof certified by its Secretary or an Assistant Secretary;
(c) the Trustee may consult with counsel, and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection in respect of any action taken or
suffered or omitted by it hereunder in good faith and in accordance with such advice or Opinion of
Counsel;
(d) the Trustee shall be under no obligation to exercise any of the rights or powers vested in
it by this Indenture at the request, order or direction of any of the Holders of Debt Securities of
any series pursuant to the provisions of this Indenture, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the costs, expenses and liabilities which may
be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or omitted by it in good faith and
reasonably believed by it to be authorized or within the discretion or rights or powers conferred
upon it by this Indenture;
(f) prior to the occurrence of an Event of Default and after the curing of all Events of
Default which may have occurred, the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, approval or other paper or document, unless requested
in writing to do so by the Holders of a majority in aggregate principal amount of the then
Outstanding Debt Securities of a series affected by such matter; provided, however, that if the
payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be
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incurred by it in the making of such investigation is not, in the opinion of the Trustee,
reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture,
the Trustee may require reasonable indemnity against such costs, expenses or liabilities as a
condition to so proceeding, and the reasonable expense of every such investigation shall be paid by
the Issuers or, if paid by the Trustee, shall be repaid by the Issuers upon demand;
(g) the Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys and the Trustee shall not be
responsible for any misconduct or negligence on the part of any agent or attorney appointed by it
with due care hereunder; and
(h) if any property other than cash shall at any time be subject to a Lien in favor of the
Holders, the Trustee, if and to the extent authorized by a receivership or bankruptcy court of
competent jurisdiction or by the supplemental instrument subjecting such property to such Lien,
shall be entitled to make advances for the purpose of preserving such property or of discharging
tax Liens or other prior Liens or encumbrances thereon.
Section 7.03 Trustee Not Liable for Recitals in Indenture or in Debt Securities. The
recitals contained herein, in the Debt Securities (except the Trustees certificate of
authentication) shall be taken as the statements of the Issuers, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Debt Securities of any series, except that the
Trustee represents that it is duly authorized to execute and deliver this Indenture, authenticate
the Debt Securities and perform its obligations hereunder, and that the statements made by it or to
be made by it in a Statement of Eligibility and Qualification on Form T-1 supplied to the Issuers
are true and accurate. The Trustee shall not be accountable for the use or application by the
Issuers of any of the Debt Securities or of the proceeds thereof.
Section 7.04 Trustee, Paying Agent or Registrar May Own Debt Securities. The Trustee
or any paying agent or Registrar, in its individual or any other capacity, may become the owner or
pledgee of Debt Securities and subject to the provisions of the TIA relating to conflicts of
interest and preferential claims may otherwise deal with the Issuers with the same rights it would
have if it were not Trustee, paying agent or Registrar.
Section 7.05 Moneys Received by Trustee to Be Held in Trust. Subject to the
provisions of Section 11.05, all moneys received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any moneys received by it hereunder. So long as no Event of Default
shall have occurred and be continuing, all interest allowed on any such moneys shall be paid from
time to time to the Issuers upon an Issuer Order.
Section 7.06 Compensation and Reimbursement. The Issuers covenant and agree to pay in
Dollars to the Trustee from time to time, and the Trustee shall be entitled to, reasonable
compensation for all services rendered by it hereunder (which shall not be limited by any provision
of law in regard to the compensation of a trustee of an express trust), and, except as otherwise
expressly provided herein, the Issuers will pay or reimburse in Dollars the Trustee
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upon its request for all reasonable expenses, disbursements and advances incurred or made by
the Trustee in accordance with any of the provisions of this Indenture (including the reasonable
compensation and the expenses and disbursements of its agents, attorneys and counsel and of all
Persons not regularly in its employ), including without limitation, Section 6.02, except any such
expense, disbursement or advances as may arise from its negligence, willful misconduct or bad
faith. The Issuers also covenant to indemnify in Dollars the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence, willful misconduct or bad
faith on the part of the Trustee, arising out of or in connection with the acceptance or
administration of this trust or trusts hereunder, including the reasonable costs and expenses of
defending itself against any claim of liability in connection with the exercise or performance of
any of its powers or duties hereunder. The obligations of the Issuers under this Section 7.06 to
compensate and indemnify the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional Debt hereunder and shall survive the
satisfaction and discharge of this Indenture. The Issuers and the Holders agree that such
additional Debt shall be secured by a Lien prior to that of the Debt Securities upon all property
and funds held or collected by the Trustee, as such, except funds held in trust for the payment of
principal of, and premium, if any, or interest on, particular Debt Securities.
When the Trustee incurs expenses or renders services after an Event of Default specified in
Section 6.01(e) or (f) occurs, the expenses and the compensation for the services are intended to
constitute expenses of administration under any Bankruptcy Law.
Section 7.07 Right of Trustee to Rely on an Officers Certificate Where No Other Evidence
Specifically Prescribed. Except as otherwise provided in Section 7.01, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it necessary or desirable
that a matter be proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed)
may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers Certificate delivered to the Trustee and such
certificate, in the absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the provisions of this
Indenture upon the faith thereof.
Section 7.08 Separate Trustee; Replacement of Trustee. The Issuers may, but need not,
appoint a separate Trustee for any one or more series of Debt Securities. The Trustee may resign
with respect to one or more or all series of Debt Securities at any time by giving notice to the
Issuers. The Holders of a majority in principal amount of the Debt Securities of a particular
series may remove the Trustee for such series and only such series by so notifying the Trustee and
may appoint a successor Trustee. The Issuers shall remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged bankrupt or insolvent;
(c) a Custodian takes charge of the Trustee or its property; or
(d) the Trustee otherwise becomes incapable of acting.
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If the Trustee resigns, is removed by the Issuers or by the Holders of a majority in principal
amount of the Debt Securities of a particular series and such Holders do not reasonably promptly
appoint a successor Trustee, or if a vacancy exists in the office of Trustee for any reason (the
Trustee in such event being referred to herein as the retiring Trustee), the Issuers shall promptly
appoint a successor Trustee. No resignation or removal of the Trustee and no appointment of a
successor Trustee shall become effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of this Section 7.08.
A successor Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Issuers. Thereupon the resignation or removal of the retiring Trustee shall
become effective, and the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to
Holders of Debt Securities of each applicable series. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, subject to the Lien provided for in
Section 7.06.
If a successor Trustee does not take office within 60 days after the retiring Trustee gives
notice of resignation or is removed, the retiring Trustee or the Holders of 25% in principal amount
of the Debt Securities of any applicable series may petition any court of competent jurisdiction
for the appointment of a successor Trustee for the Debt Securities of such series.
If the Trustee fails to comply with Section 7.10, any Holder of Debt Securities of any
applicable series may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee for the Debt Securities of such series.
Notwithstanding the replacement of the Trustee pursuant to this Section 7.08, the Issuers
obligations under Section 7.06 shall continue for the benefit of the retiring Trustee.
In the case of the appointment hereunder of a separate or successor Trustee with respect to
the Debt Securities of one or more series, the Issuers, any retiring Trustee and each successor or
separate Trustee with respect to the Debt Securities of any applicable series shall execute and
deliver an Indenture supplemental hereto (i) which shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties of any retiring
Trustee with respect to the Debt Securities of any series as to which any such retiring Trustee is
not retiring shall continue to be vested in such retiring Trustee and (ii) that shall add to or
change any of the provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one trustee, it being understood that
nothing herein or in such supplemental Indenture shall constitute such Trustees co-trustees of the
same trust and that each such separate, retiring or successor Trustee shall be Trustee of a trust
or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other
such Trustee.
Section 7.09 Successor Trustee by Merger. If the Trustee consolidates with, merges or
converts into, or transfers all or substantially all its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or transferee corporation or
banking association without any further act shall be the successor Trustee.
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In case at the time such successor or successors to the Trustee by merger, conversion,
consolidation or transfer shall succeed to the trusts created by this Indenture any of the Debt
Securities shall have been authenticated but not delivered, any such successor to the Trustee may
adopt the certificate of authentication of any predecessor Trustee, and deliver such Debt
Securities so authenticated; and in case at that time any of the Debt Securities shall not have
been authenticated, any successor to the Trustee may authenticate such Debt Securities either in
the name of any predecessor hereunder or in the name of the successor to the Trustee; and in all
such cases such certificates shall have the full force which it is anywhere in the Debt Securities
or in this Indenture provided that the certificate of the Trustee shall have.
Section 7.10 Eligibility; Disqualification. The Trustee shall at all times satisfy
the requirements of Section 310(a) of the TIA. The Trustee shall have a combined capital and
surplus of at least $50,000,000 as set forth in its most recent published annual report of
condition. No obligor upon the Debt Securities of a particular series or Person directly or
indirectly controlling, controlled by or under common control with such obligor shall serve as
Trustee for the Debt Securities of such series. The Trustee shall comply with Section 310(b) of
the TIA; provided, however, that there shall be excluded from the operation of Section 310(b)(1) of
the TIA this Indenture or any indenture or indentures under which other securities or certificates
of interest or participation in other securities of the Issuers are outstanding if the requirements
for such exclusion set forth in Section 310(b)(1) of the TIA are met.
Section 7.11 Preferential Collection of Claims Against Issuers. The Trustee shall
comply with Section 311(a) of the TIA, excluding any creditor relationship listed in Section 311(b)
of the TIA. A Trustee who has resigned or been removed shall be subject to Section 311(a) of the
TIA to the extent indicated therein.
Section 7.12 Compliance with Tax Laws. The Trustee hereby agrees to comply with all
U.S. Federal income tax information reporting and withholding requirements applicable to it with
respect to payments of premium (if any) and interest on the Debt Securities, whether acting as
Trustee, Registrar, paying agent or otherwise with respect to the Debt Securities.
ARTICLE VIII
CONCERNING THE HOLDERS
Section 8.01 Evidence of Action by Holders. Whenever in this Indenture it is provided
that the Holders of a specified percentage in aggregate principal amount of the Debt Securities of
any or all series may take action (including the making of any demand or request, the giving of any
direction, notice, consent or waiver or the taking of any other action) the fact that at the time
of taking any such action the Holders of such specified percentage have joined therein may be
evidenced (a) by any instrument or any number of instruments of similar tenor executed by Holders
in Person or by agent or proxy appointed in writing, (b) by the record of the Holders voting in
favor thereof at any meeting of Holders duly called and held in accordance with the provisions of
Section 5.02, (c) by a combination of such instrument or instruments and any such record of such a
meeting of Holders or (d) in the case of Debt Securities evidenced by a Global Security, by any
electronic transmission or other message, whether or not in written format, that complies with the
Depositarys applicable procedures.
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Section 8.02 Proof of Execution of Instruments and of Holding of Debt Securities.
Subject to the provisions of Sections 7.01, 7.02 and 13.09, proof of the execution of any
instrument by a Holder or his agent or proxy shall be sufficient if made in accordance with such
reasonable rules and regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee. The ownership of Debt Securities of any series shall be proved by the
Debt Security Register or by a certificate of the Registrar for such series. The Trustee may
require such additional proof of any matter referred to in this Section 8.02 as it shall deem
necessary.
Section 8.03 Who May Be Deemed Owner of Debt Securities. Prior to due presentment for
registration of transfer of any Debt Security, the Issuers, the Subsidiary Guarantors, the Trustee,
any paying agent and any Registrar may deem and treat the Person in whose name any Debt Security
shall be registered upon the books of the Issuers as the absolute owner of such Debt Security
(whether or not such Debt Security shall be overdue and notwithstanding any notation of ownership
or other writing thereon) for the purpose of receiving payment of or on account of the principal of
and premium, if any, and (subject to Section 2.12) interest on such Debt Security and for all other
purposes, and none of the Issuers, the Subsidiary Guarantors or the Trustee nor any paying agent
nor any Registrar shall be affected by any notice to the contrary; and all such payments so made to
any such Holder for the time being, or upon his order, shall be valid and, to the extent of the sum
or sums so paid, effectual to satisfy and discharge the liability for moneys payable upon any such
Debt Security.
None of the Issuers, the Subsidiary Guarantors, the Trustee, any paying agent or any Registrar
will have any responsibility or liability for any aspect of the records relating to or payments
made on account of beneficial ownership interests in a Global Security or for maintaining,
supervising or reviewing any records relating to such beneficial ownership interests.
Section 8.04 Instruments Executed by Holders Bind Future Holders. At any time prior
to (but not after) the evidencing to the Trustee, as provided in Section 8.01, of the taking of any
action by the Holders of the percentage in aggregate principal amount of the Debt Securities of any
series specified in this Indenture in connection with such action and subject to the following
paragraph, any Holder of a Debt Security which is shown by the evidence to be included in the Debt
Securities the Holders of which have consented to such action may, by filing written notice with
the Trustee at its corporate trust office and upon proof of holding as provided in Section 8.02,
revoke such action so far as concerns such Debt Security. Except as aforesaid any such action
taken by the Holder of any Debt Security shall be conclusive and binding upon such Holder and upon
all future Holders and owners of such Debt Security and of any Debt Security issued upon transfer
thereof or in exchange or substitution therefor, irrespective of whether or not any notation in
regard thereto is made upon such Debt Security or such other Debt Securities. Any action taken by
the Holders of the percentage in aggregate principal amount of the Debt Securities of any series
specified in this Indenture in connection with such action shall be conclusively binding upon the
Issuers, the Subsidiary Guarantors, the Trustee and the Holders of all the Debt Securities of such
series.
The Issuers may, but shall not be obligated to, fix a record date for the purpose of
determining the Holders of Debt Securities entitled to give their consent or take any other action
required or permitted to be taken pursuant to this Indenture. If a record date is fixed, then
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notwithstanding the immediately preceding paragraph, those Persons who were Holders of Debt
Securities at such record date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to take any such action,
whether or not such Persons continue to be Holders of Debt Securities after such record date. No
such consent shall be valid or effective for more than 120 days after such record date unless the
consent of the Holders of the percentage in aggregate principal amount of the Debt Securities of
such series specified in this Indenture shall have been received within such 120-day period.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01 Purposes for Which Supplemental Indenture May Be Entered into Without Consent
of Holders. The Issuers and any Subsidiary Guarantors, when authorized by resolutions of each
Issuers Board of Directors, and the Trustee may from time to time and at any time, without the
consent of Holders, enter into an Indenture or Indentures supplemental hereto (which shall conform
to the provisions of the TIA as in force at the date of the execution thereof) for one or more of
the following purposes:
(a) to evidence the succession pursuant to Article X of another Person to either of the
Issuers, or successive successions, and the assumption by the Successor Company (as defined in
Section 10.01) of the covenants, agreements and obligations of its predecessor Issuer in this
Indenture and in the Debt Securities;
(b) to surrender any right or power herein conferred upon the Issuers or the Subsidiary
Guarantors, to add to the covenants of the Issuers or the Subsidiary Guarantors such further
covenants, restrictions, conditions or provisions for the protection of the Holders of all or any
series of Debt Securities (and if such covenants are to be for the benefit of less than all series
of Debt Securities, stating that such covenants are expressly being included solely for the benefit
of such series) as the Board of Directors shall consider to be for the protection of the Holders of
such Debt Securities, and to make the occurrence, or the occurrence and continuance, of a Default
in any of such additional covenants, restrictions, conditions or provisions a Default or an Event
of Default permitting the enforcement of all or any of the several remedies provided in this
Indenture; provided, that in respect of any such additional covenant, restriction, condition or
provision such supplemental Indenture may provide for a particular period of grace after Default
(which period may be shorter or longer than that allowed in the case of other Defaults) or may
provide for an immediate enforcement upon such Default or may limit the remedies available to the
Trustee upon such Default or may limit the right of the Holders of a majority in aggregate
principal amount of any or all series of Debt Securities to waive such Default;
(c) to cure any ambiguity or omission or to correct or supplement any provision contained
herein, in any supplemental Indenture or in any Debt Securities of any series that may be defective
or inconsistent with any other provision contained herein, in any supplemental Indenture or in the
Debt Securities of such series; to convey, transfer, assign, mortgage or pledge any property to or
with the Trustee, or to make such other provisions in regard to matters or questions arising under
this Indenture as shall not adversely affect the interests of any Holders of Debt Securities of any
series;
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(d) to permit the qualification of this Indenture or any Indenture supplemental hereto under
the TIA as then in effect, except that nothing herein contained shall permit or authorize the
inclusion in any Indenture supplemental hereto of the provisions referred to in Section 316(a)(2)
of the TIA;
(e) to change or eliminate any restrictions on the payment of principal of, or premium, if
any, on, Debt Securities; provided, that any such action shall not adversely affect the interests
of the Holders of Debt Securities of any series in any material respect or permit or facilitate the
issuance of Debt Securities of any series in uncertificated form;
(f) to reflect the release of any Subsidiary Guarantor in accordance with Article XIV
(g) in the case of any Debt Securities subordinated pursuant to Article XII, to make any
change in Article XII that would limit or terminate the benefits available to any holder of Senior
Indebtedness (or Representatives therefor) under Article XII;
(h) to add Subsidiary Guarantors with respect to any or all of the Debt Securities or to
secure any or all of the Debt Securities or the Guarantee;
(i) to make any change that does not adversely affect the rights hereunder of any Holder;
(j) to add to, change or eliminate any of the provisions of this Indenture in respect of one
or more series of Debt Securities; provided, however, that any such addition, change or elimination
not otherwise permitted under this Section 9.01 shall neither apply to any Debt Security of any
series created prior to the execution of such supplemental Indenture and entitled to the benefit of
such provision nor modify the rights of the Holder of any such Debt Security with respect to such
provision or shall become effective only when there is no such Debt Security Outstanding;
(k) to evidence and provide for the acceptance of appointment hereunder by a successor or
separate Trustee with respect to the Debt Securities of one or more series and to add to or change
any of the provisions of this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee; and
(l) to establish the form or terms of Debt Securities of any series as permitted by Sections
2.01 and 2.03.
The Trustee is hereby authorized to join with the Issuers and the Subsidiary Guarantors in the
execution of any such supplemental Indenture, to make any further appropriate agreements and
stipulations which may be therein contained and to accept the conveyance, transfer, assignment,
mortgage or pledge of any property thereunder, but the Trustee shall not be obligated to enter into
any such supplemental Indenture which affects the Trustees own rights, duties or immunities under
this Indenture or otherwise.
Any supplemental Indenture authorized by the provisions of this Section 9.01 may be executed
by the Issuers, the Subsidiary Guarantors and the Trustee without the consent of the
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Holders of any of the Debt Securities at the time Outstanding, notwithstanding any of the
provisions of Section 9.02.
In the case of Debt Securities subordinated pursuant to Article XII, an amendment under this
Section 9.01 may not make any change that adversely affects the rights under Article XII of any
holder of Senior Indebtedness then outstanding unless the holders of such Senior Indebtedness (or
any group or Representative thereof authorized to give a consent) consent to such change.
Section 9.02 Modification of Indenture with Consent of Holders of Debt Securities.
Without notice to any Holder but with the consent (evidenced as provided in Section 8.01) of the
Holders of not less than a majority in aggregate principal amount of the Outstanding Debt
Securities of each series affected by such supplemental Indenture (including consents obtained in
connection with a tender offer or exchange offer for any such series of Debt Securities), the
Issuers and the Subsidiary Guarantors, when authorized by resolutions of each Issuers Board of
Directors, and the Trustee may from time to time and at any time enter into an Indenture or
Indentures supplemental hereto (which shall conform to the provisions of the TIA as in force at the
date of execution thereof) for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of any supplemental Indenture or of
modifying in any manner the rights of the Holders of the Debt Securities of such series; provided,
that no such supplemental Indenture, without the consent of the Holders of each Debt Security so
affected, shall: reduce the percentage in principal amount of Debt Securities of any series whose
Holders must consent to an amendment; reduce the rate of or extend the time for payment of
interest on any Debt Security; reduce the principal of or extend the Stated Maturity of any Debt
Security; reduce any premium payable upon the redemption of any Debt Security or change the time
at which any Debt Security may or shall be redeemed in accordance with Article III; make any Debt
Security payable in currency other than the Dollar; impair the right of any Holder to receive
payment of premium, if any, principal of and interest on such Holders Debt Securities on or after
the due dates therefor or to institute suit for the enforcement of any payment on or with respect
to such Holders Debt Securities; in the case of any Debt Security subordinated pursuant to Article
XII, make any change in Article XII that adversely affects the rights of any Holder under Article
XII; release any security that may have been granted in respect of the Debt Securities, other than
in accordance with this Indenture; make any change in Section 6.06 or this Section 9.02; or, except
as provided in Section 11.02(b) or Section14.04, release the Subsidiary Guarantors other than as
provided in this Indenture or modify the Guarantee in any manner adverse to the Holders.
A supplemental Indenture which changes or eliminates any covenant or other provision of this
Indenture which has been expressly included solely for the benefit of one or more particular series
of Debt Securities or which modifies the rights of the Holders of Debt Securities of such series
with respect to such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Debt Securities of any other series.
Upon the request of the Issuers, accompanied by a copy of resolutions of the Board of
Directors of each Issuer authorizing the execution of any such supplemental Indenture, and upon the
filing with the Trustee of evidence of the consent of Holders as aforesaid, the Trustee shall join
with the Issuers and the Subsidiary Guarantors in the execution of such supplemental
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Indenture unless such supplemental Indenture affects the Trustees own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in its discretion but
shall not be obligated to enter into such supplemental Indenture.
It shall not be necessary for the consent of the Holders under this Section 9.02 to approve
the particular form of any proposed supplemental Indenture, but it shall be sufficient if such
consent shall approve the substance thereof.
In the case of any Debt Securities subordinated pursuant to Article XII, an amendment under
this Section 9.02 may not make any change that adversely affects the rights under Article XII of
any holder of Senior Indebtedness then outstanding unless the holders of such Senior Indebtedness
(or any group or Representative thereof authorized to give a consent) consent to such change.
After an amendment under this Section 9.02 requiring the consent of the Holders of any series
of Debt Securities becomes effective, the Issuers shall mail to Holders of that series of Debt
Securities of each series affected thereby a notice briefly describing such amendment. The failure
to give such notice to any such Holders, or any defect therein, shall not impair or affect the
validity of an amendment under this Section 9.02 with respect to other Holders.
Section 9.03 Effect of Supplemental Indentures. Upon the execution of any
supplemental Indenture pursuant to the provisions of this Article IX, this Indenture shall be and
be deemed to be modified and amended in accordance therewith and the respective rights, limitations
of rights, obligations, duties and immunities under this Indenture of the Trustee, the Issuers, the
Subsidiary Guarantors and the Holders shall thereafter be determined, exercised and enforced
hereunder subject in all respects to such modifications and amendments, and all the terms and
conditions of any such supplemental Indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
The Trustee, subject to the provisions of Sections 7.01 and 7.02, may receive an Officers
Certificate and an Opinion of Counsel as conclusive evidence that any such supplemental Indenture
complies with the provisions of this Article IX.
Section 9.04 Debt Securities May Bear Notation of Changes by Supplemental Indentures.
Debt Securities of any series authenticated and delivered after the execution of any supplemental
Indenture pursuant to the provisions of this Article IX may, and shall if required by the Trustee,
bear a notation in form approved by the Trustee as to any matter provided for in such supplemental
Indenture. New Debt Securities of any series so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any modification of this Indenture contained in any such
supplemental Indenture may be prepared and executed by the Issuers, authenticated by the Trustee
and delivered in exchange for the Debt Securities of such series then Outstanding. Failure to make
the appropriate notation or to issue a new Debt Security of such series shall not affect the
validity of such amendment.
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ARTICLE X
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 10.01 Consolidations and Mergers of the Issuers. Neither of the Issuers may
consolidate or amalgamate with or merge with or into any Person, or sell, convey, transfer, lease
or otherwise dispose of all or substantially all its assets to any Person, whether in a single
transaction or a series of related transactions, unless: (a) either (i) such Issuer shall be the
surviving Person in the case of a merger or (ii) the resulting, surviving or transferee Person if
other than such Issuer (the Successor Company), shall be a partnership, limited liability company
or corporation organized and existing under the laws of the United States, any State thereof or the
District of Columbia and the Successor Company shall expressly assume, by an Indenture supplemental
hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of such Issuer under this Indenture and the Debt Securities according to their tenor;
(b) immediately after giving effect to such transaction or series of transactions (and treating any
Debt which becomes an obligation of the Successor Company or any Subsidiary of such Issuer as a
result of such transaction as having been incurred by the Successor Company or such Subsidiary at
the time of such transaction or series of transactions), no Default or Event of Default would occur
or be continuing; (c) if such Issuer is not the continuing Person, then each Subsidiary Guarantor,
unless it has become the Successor Company, shall confirm that its Guarantee shall continue to
apply to the obligations under the Debt Securities and this Indenture; and (d) the Issuers shall
have delivered to the Trustee an Officers Certificate and an Opinion of Counsel, each stating that
such consolidation, amalgamation, merger or disposition and such supplemental Indenture (if any)
comply with this Indenture.
Section 10.02 Rights and Duties of Successor Company. In case of any consolidation,
amalgamation or merger where such Issuer is not the continuing Person, or disposition of all or
substantially all of the assets of such Issuer in accordance with Section 10.01, the Successor
Company shall succeed to and be substituted for such Issuer with the same effect as if it had been
named herein as the respective party to this Indenture, and the predecessor entity shall be
released from all liabilities and obligations under this Indenture and the Debt Securities, except
that no such release will occur in the case of a lease of all or substantially all of such Issuers
assets. The Successor Company thereupon may cause to be signed, and may issue either in its own
name or in the name of such Issuer, any or all the Debt Securities issuable hereunder which
theretofore shall not have been signed by or on behalf of such Issuer and delivered to the
Trustee; and, upon the order of the Successor Company, instead of such Issuer, and subject to all
the terms, conditions and limitations in this Indenture prescribed, the Trustee shall authenticate
and shall deliver any Debt Securities which previously shall have been signed and delivered by or
on behalf of such Issuer to the Trustee for authentication, and any Debt Securities which the
Successor Company thereafter shall cause to be signed and delivered to the Trustee for that
purpose. All the Debt Securities so issued shall in all respects have the same legal rank and
benefit under this Indenture as the Debt Securities theretofore or thereafter issued in accordance
with the terms of this Indenture as though all such Debt Securities had been issued at the date of
the execution hereof.
In case of any such consolidation, amalgamation, merger, sale or disposition such changes in
phraseology and form (but not in substance) may be made in the Debt Securities thereafter to be
issued as may be appropriate.
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ARTICLE XI
SATISFACTION AND DISCHARGE OF
INDENTURE; DEFEASANCE; UNCLAIMED MONEYS
Section 11.01 Applicability of Article. The provisions of this Article XI relating to
discharge or defeasance of Debt Securities shall be applicable to each series of Debt Securities
except as otherwise specified pursuant to Section 2.03 for Debt Securities of such series.
Section 11.02 Satisfaction and Discharge of Indenture; Defeasance.
(a) If at any time the Issuers shall have delivered to the Trustee for cancellation all Debt
Securities of any series theretofore authenticated and delivered (other than any Debt Securities of
such series which shall have been destroyed, lost or stolen and which shall have been replaced or
paid as provided in Section 2.09 and Debt Securities for whose payment money has theretofore been
deposited in trust and thereafter repaid to the Issuers as provided in Section 11.05) or all Debt
Securities of such series not theretofore delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within one year or are to
be called for redemption within one year under arrangements satisfactory to the Trustee for the
giving of notice of redemption, and the Issuers shall deposit with the Trustee as trust funds the
entire amount in cash sufficient to pay at final maturity or upon redemption all Debt Securities of
such series not theretofore delivered to the Trustee for cancellation, including principal and
premium, if any, and interest due or to become due on such date of maturity or Redemption Date, as
the case may be, and if in either case the Issuers shall also pay or cause to be paid all other
sums payable hereunder by the Issuers, then this Indenture shall cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of such Debt Securities
herein expressly provided for) with respect to the Debt Securities of such series, and the Trustee,
on demand of the Issuers accompanied by an Officers Certificate and an Opinion of Counsel and at
the cost and expense of the Issuers, shall execute proper instruments acknowledging satisfaction of
and discharging this Indenture with respect to the Debt Securities of such series.
(b) Subject to Sections 11.02(c), 11.03 and 11.07, the Issuers at any time may terminate, with
respect to Debt Securities of a particular series, all its obligations under the Debt Securities
of such series and this Indenture with respect to the Debt Securities of such series (legal
defeasance option) or the operation of (w) Sections 4.09 and 4.10, (x) any covenant made
applicable to such Debt Securities pursuant to Section 2.03, (y) Sections 6.01(d), (g) and (h) and
(z) as they relate to the Subsidiary Guarantors only, Sections 6.01(e) and (f) (covenant
defeasance option). If the Issuers exercise either their legal defeasance option or their
covenant defeasance option with respect to Debt Securities of a particular series that are entitled
to the benefit of the Guarantee, the Guarantee will terminate with respect to that series of Debt
Securities. The Issuers may exercise their legal defeasance option notwithstanding its prior
exercise of its covenant defeasance option.
If the Issuers exercise their legal defeasance option, payment of the Debt Securities of the
defeased series may not be accelerated because of an Event of Default. If the Issuers exercise
their covenant defeasance option, payment of the Debt Securities of the defeased series may not
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be accelerated because of an Event of Default specified in Sections 6.01(d), (g) and (h) and,
with respect to the Subsidiary Guarantors only, Sections 6.01(e) and (f).
Upon satisfaction of the conditions set forth herein and upon request of the Issuers, the
Trustee shall acknowledge in writing the discharge of those obligations that the Issuers terminate.
(c) Notwithstanding clauses (a) and (b) above, the Issuers obligations in Sections 2.07,
2.09, 4.02, 4.03, 4.04, the last sentence of 4.05(a), 4.06(a), 5.01, 7.06, 11.05, 11.06 and 11.07
shall survive until the Debt Securities of the defeased series have been paid in full. Thereafter,
the Issuers obligations in Sections 7.06, 11.05 and 11.06 shall survive.
Section 11.03 Conditions of Defeasance. The Issuers may exercise their legal
defeasance option or its covenant defeasance option with respect to Debt Securities of a particular
series only if:
(a) the Issuers irrevocably deposit in trust with the Trustee money or U.S. Government
Obligations for the payment of principal of, and premium, if any, and interest on, the Debt
Securities of such series to final maturity or redemption, as the case may be;
(b) the Issuers deliver to the Trustee a certificate from a nationally recognized firm of
independent accountants expressing their opinion that the payments of principal and interest when
due and without reinvestment on the deposited U.S. Government Obligations plus any deposited money
without investment will provide cash at such times and in such amounts as will be sufficient to pay
the principal, premium, if any, and interest when due on all the Debt Securities of such series to
final maturity or redemption, as the case may be;
(c) 91 days pass after the deposit is made and during the 91-day period no Default specified
in Section 6.01(e) or (f) with respect to the Issuers occurs which is continuing at the end of the
period;
(d) no Default has occurred and is continuing on the date of such deposit and after giving
effect thereto;
(e) the deposit does not constitute a default under any other agreement binding on the Issuers
and, if the Debt Securities of such series are subordinated pursuant to Article XII, is not
prohibited by Article XII;
(f) the Issuers deliver to the Trustee an Opinion of Counsel to the effect that the trust
resulting from the deposit does not constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940;
(g) in the event of the legal defeasance option, the Issuers shall have delivered to the
Trustee an Opinion of Counsel stating that the Issuers have received from the Internal Revenue
Service a ruling, or since the date of this Indenture there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders of Debt Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of such defeasance and will be
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subject to Federal income tax on the same amounts, in the same manner and at the same times as
would have been the case if such defeasance had not occurred;
(h) in the event of the covenant defeasance option, the Issuers shall have delivered to the
Trustee an Opinion of Counsel to the effect that the Holders of Debt Securities of such series will
not recognize income, gain or loss for Federal income tax purposes as a result of such covenant
defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such covenant defeasance had not occurred; and
(i) the Issuers deliver to the Trustee an Officers Certificate and an Opinion of Counsel,
each stating that all conditions precedent to the defeasance and discharge of the Debt Securities
of such series as contemplated by this Article XI have been complied with.
Before or after a deposit, the Issuers may make arrangements satisfactory to the Trustee for
the redemption of Debt Securities of such series at a future date in accordance with Article III.
Section 11.04 Application of Trust Money. The Trustee shall hold in trust money or
U.S. Government Obligations deposited with it pursuant to this Article XI. It shall apply the
deposited money and the money from U.S. Government Obligations through any paying agent and in
accordance with this Indenture to the payment of principal of, and premium, if any, and interest
on, the Debt Securities of the defeased series. In the event the Debt Securities of the defeased
series are subordinated pursuant to Article XII, money and securities so held in trust are not
subject to Article XII.
Section 11.05 Repayment to Issuers. The Trustee and any paying agent shall promptly
turn over to the Issuers upon request any excess money or securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and any paying agent shall pay
to the Issuers upon request any money held by them for the payment of principal, premium or
interest that remains unclaimed for two years, and, thereafter, Holders entitled to such money must
look to the Issuers for payment as general creditors.
Section 11.06 Indemnity for U.S. Government Obligations. The Issuers shall pay and
shall indemnify the Trustee and the Holders against any tax, fee or other charge imposed on or
assessed against deposited U.S. Government Obligations or the principal and interest received on
such U.S. Government Obligations.
Section 11.07 Reinstatement. If the Trustee or any paying agent is unable to apply
any money or U.S. Government Obligations in accordance with this Article XI by reason of any legal
proceeding or by reason of any order or judgment of any court or government authority enjoining,
restraining or otherwise prohibiting such application, the Issuers obligations under this
Indenture and the Debt Securities of the defeased series shall be revived and reinstated as though
no deposit had occurred pursuant to this Article XI until such time as the Trustee or any paying
agent is permitted to apply all such money or U.S. Government Obligations in accordance with this
Article XI.
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ARTICLE XII
SUBORDINATION OF DEBT SECURITIES AND GUARANTEE
Section 12.01 Applicability of Article; Agreement to Subordinate. The provisions of
this Article XII shall only be applicable to the Debt Securities of any series (Debt Securities of
such series referred to in this Article XII as Subordinated Debt Securities) designated, pursuant
to Section 2.03, as subordinated to Senior Indebtedness and any related Guarantee of such
Subordinated Debt Securities. Each Holder by accepting a Subordinated Debt Security agrees that
the Debt evidenced by such Subordinated Debt Security and any related Guarantee of such
Subordinated Debt Security is subordinated in right of payment, to the extent and in the manner
provided in this Article XII, to the prior payment of all Senior Indebtedness and that the
subordination is for the benefit of and enforceable by the holders of Senior Indebtedness. All
provisions of this Article XII shall be subject to Section 12.12.
Section 12.02 Liquidation, Dissolution, Bankruptcy. Upon any payment or distribution
of the assets of any of the Issuers or the Subsidiary Guarantors to creditors (i) upon a
liquidation or a dissolution of any of the Issuers or the Subsidiary Guarantors or (ii) in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to any of the
Issuers or the Subsidiary Guarantors or its property:
(a) holders of Senior Indebtedness of the Issuers or any Subsidiary Guarantor, as the case may
be, shall be entitled to receive payment in full in cash of such Senior Indebtedness of such Person
(including interest (if any), accruing on or after the commencement of a proceeding in bankruptcy,
whether or not allowed as a claim against any of the Issuers or the Subsidiary Guarantors, as the
case may be, in such bankruptcy proceeding) before Holders of Subordinated Debt Securities and any
related Guarantee shall be entitled to receive any payment of principal of, or premium, if any, or
interest on, the Subordinated Debt Securities from the Issuers, or any payment in respect of the
Guarantee from the Subsidiary Guarantors; and
(b) until the Senior Indebtedness of the Issuers or any Subsidiary Guarantor, as the case may
be, is paid in full, any distribution to which Holders of Subordinated Debt Securities and any
related Guarantee would be entitled but for this Article XII shall be made to holders of Senior
Indebtedness of the Issuers or the Subsidiary Guarantors, as the case may be, as their interests
may appear, except that such Holders may receive capital stock and any debt securities that are
subordinated to Senior Indebtedness of any of the Issuers or the Subsidiary Guarantors, as the case
may be, to at least the same extent as the Subordinated Debt Securities of the Issuers or the
related Guarantee of any Subsidiary Guarantor, respectively.
Section 12.03 Default on Senior Indebtedness. The Issuers and the Subsidiary
Guarantors may not pay the principal of, or premium, if any, or interest on, the Subordinated Debt
Securities or any related Guarantee or make any deposit pursuant to Article XI and may not
repurchase, redeem or otherwise retire (except, in the case of Subordinated Debt Securities that
provide for a mandatory sinking fund pursuant to Section 3.05, by the delivery of Subordinated Debt
Securities by the Issuers to the Trustee pursuant to the first paragraph of Section 3.05) any
Subordinated Debt Securities (collectively, pay the Subordinated Debt Securities) if any
principal, premium or interest in respect of Senior Indebtedness of such Person is not paid within
any applicable grace period (including at maturity) or any other default on Senior Indebtedness
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of such Person occurs and the maturity of such Senior Indebtedness is accelerated in
accordance with its terms unless and until the default has been cured or waived and any such
acceleration has been rescinded or such Senior Indebtedness has been paid in full in cash;
provided, however, that the Issuers and the Subsidiary Guarantors may make payments on the
Subordinated Debt Securities or any related Guarantee without regard to the foregoing if the
Issuers and the Trustee receive written notice approving such payment from the Representative of
each issue of Designated Senior Indebtedness. During the continuance of any other default with
respect to any Designated Senior Indebtedness pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be required to effect
such acceleration) or the expiration of any applicable grace periods, the Issuers and the
Subsidiary Guarantors may not make payments on the Subordinated Debt Securities or any related
Guarantee for a period (a Payment Blockage Period) commencing upon the receipt by the Issuers and
the Trustee (and if such Designated Senior Indebtedness is Debt of a Subsidiary Guarantor, the
Subsidiary Guarantor) of written notice of such default from the Representative of any Designated
Senior Indebtedness specifying an election to effect a Payment Blockage Period (a Blockage
Notice) and ending 179 days thereafter (or earlier if such Payment Blockage Period is terminated
by written notice to the Trustee and the Issuers (and if such Designated Senior Indebtedness is
Debt of a Subsidiary Guarantor, the Subsidiary Guarantor) from the Person or Persons who gave such
Blockage Notice, by repayment in full in cash of such Designated Senior Indebtedness or because
the default giving rise to such Blockage Notice is no longer continuing). Notwithstanding the
provisions described in the immediately preceding sentence (but subject to the provisions contained
in Section 12.02 and the first sentence of this Section 12.03), unless the holders of such
Designated Senior Indebtedness or the Representative of such holders shall have accelerated the
maturity of such Designated Senior Indebtedness, the Issuers and the Subsidiary Guarantors may
resume payments on the Subordinated Debt Securities and related Guarantees after such Payment
Blockage Period. Not more than one Blockage Notice may be given in any consecutive 360-day period,
irrespective of the number of defaults with respect to any number of issues of Designated Senior
Indebtedness during such period, unless otherwise specified pursuant to Section 2.03 for the
Subordinated Debt Securities of a series; provided, however, that in no event may the total number
of days during which any Payment Blockage Period or Periods is in effect exceed 179 days in the
aggregate during any 360 consecutive day period. For purposes of this Section 12.03, no default or
event of default which existed or was continuing on the date of the commencement of any Payment
Blockage Period with respect to the Designated Senior Indebtedness initiating such Payment Blockage
Period shall be, or be made, the basis of the commencement of a subsequent Payment Blockage Period
by the Representative of such Designated Senior Indebtedness, whether or not within a period of 360
consecutive days, unless such default or event of default shall have been cured or waived for a
period of not less than 90 consecutive days.
Section 12.04 Acceleration of Payment of Debt Securities. If payment of the
Subordinated Debt Securities is accelerated because of an Event of Default, the Issuers shall
promptly notify the holders of the Designated Senior Indebtedness (or their Representatives) of the
acceleration.
Section 12.05 When Distribution Must Be Paid Over. If a distribution is made to
Holders of Subordinated Debt Securities or a related Guarantee that because of this Article XII
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should not have been made to them, the Holders who receive such distribution shall hold it in
trust for holders of Senior Indebtedness and pay it over to them as their interests may appear.
Section 12.06 Subrogation. After all Senior Indebtedness is paid in full and until
the Subordinated Debt Securities are paid in full, Holders thereof shall be subrogated to the
rights of holders of Senior Indebtedness to receive distributions applicable to Senior
Indebtedness. A distribution made under this Article XII to holders of Senior Indebtedness which
otherwise would have been made to Holders of Subordinated Debt Securities is not, as between the
Issuers or the Subsidiary Guarantors, as the case may be, and such Holders, a payment by the
Issuers or the Subsidiary Guarantors, as the case may be, on Senior Indebtedness.
Section 12.07 Relative Rights. This Article XII defines the relative rights of
Holders of Subordinated Debt Securities and holders of Senior Indebtedness. Nothing in this
Indenture shall:
(a) impair, as between the Issuers or the Subsidiary Guarantors, as the case may be, and
Holders of Subordinated Debt Securities, the obligation of the Issuers or the Subsidiary
Guarantors, as the case may be, which is absolute and unconditional, to pay principal of, and
premium, if any, and interest on, the Subordinated Debt Securities in accordance with their terms;
or
(b) prevent the Trustee or any Holder of Subordinated Debt Securities from exercising its
available remedies upon an Event of Default, subject to the rights of holders of Senior
Indebtedness to receive distributions otherwise payable to Holders of Subordinated Debt Securities.
Section 12.08 Subordination May Not Be Impaired by Issuers. No right of any holder of
Senior Indebtedness to enforce the subordination of the Debt evidenced by the Subordinated Debt
Securities and the Guarantee in respect thereof shall be impaired by any act or failure to act by
any of the Issuers or the Subsidiary Guarantors or by its failure to comply with this Indenture.
Section 12.09 Rights of Trustee and Paying Agent. Notwithstanding Sections 12.02 and
12.03, the Trustee or any paying agent may continue to make payments on Subordinated Debt
Securities and shall not be charged with knowledge of the existence of facts that would prohibit
the making of any such payments unless, not less than two Business Days prior to the date of such
payment, a responsible officer of the Trustee receives notice satisfactory to it that payments may
not be made under this Article XII. The Issuers, the Registrar, any paying agent, a Representative
or a holder of Senior Indebtedness may give the notice; provided, however, that, if an issue of
Senior Indebtedness has a Representative, only the Representative may give the notice on behalf of
the Holders of the Senior Indebtedness of that issue.
The Trustee in its individual or any other capacity may hold Senior Indebtedness with the same
rights it would have if it were not Trustee. The Registrar and any paying agent may do the same
with like rights. The Trustee shall be entitled to all the rights set forth in this Article XII
with respect to any Senior Indebtedness which may at any time be held by it, to the same extent as
any other holder of Senior Indebtedness; and nothing in Article VII shall deprive the Trustee
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of any of its rights as such holder. Nothing in this Article XII shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.06.
Section 12.10 Distribution or Notice to Representative. Whenever a distribution is to
be made or a notice given to holders of Senior Indebtedness, the distribution may be made and the
notice given to their Representative (if any).
Section 12.11 Article XII Not to Prevent Defaults or Limit Right to Accelerate. The
failure to make a payment pursuant to the Subordinated Debt Securities, whether directly or
pursuant to the Guarantee, by reason of any provision in this Article XII shall not be construed as
preventing the occurrence of a Default. Nothing in this Article XII shall have any effect on the
right of the Holders or the Trustee to accelerate the maturity of either the Subordinated Debt
Securities or the Debt Securities, as the case may be.
Section 12.12 Trust Moneys Not Subordinated. Notwithstanding anything contained
herein to the contrary, payments from money or the proceeds of U.S. Government Obligations held in
trust under Article XI by the Trustee for the payment of principal of, and premium, if any, and
interest on, the Subordinated Debt Securities or the Debt Securities shall not be subordinated to
the prior payment of any Senior Indebtedness or subject to the restrictions set forth in this
Article XII, and none of the Holders thereof shall be obligated to pay over any such amount to the
Issuers, the Subsidiary Guarantors or any holder of Senior Indebtedness of the Issuers or the
Subsidiary Guarantors or any other creditor of the Issuers or the Guarantor.
Section 12.13 Trustee Entitled to Rely. Upon any payment or distribution pursuant to
this Article XII, the Trustee and the Holders shall be entitled to rely upon any order or decree
of a court of competent jurisdiction in which any proceedings of the nature referred to in Section
12.02 are pending, upon a certificate of the liquidating trustee or agent or other Person making
such payment or distribution to the Trustee or to such Holders or upon the Representatives for the
holders of Senior Indebtedness for the purpose of ascertaining the Persons entitled to participate
in such payment or distribution, the holders of the Senior Indebtedness and other Debt of any of
the Issuers or the Subsidiary Guarantors, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to this Article XII.
In the event that the Trustee determines, in good faith, that evidence is required with respect to
the right of any Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article XII, the Trustee may request such Person to furnish evidence
to the reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such payment or distribution
and other facts pertinent to the rights of such Person under this Article XII, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment. The provisions of Sections
7.01 and 7.02 shall be applicable to all actions or omissions of actions by the Trustee pursuant to
this Article XII.
Section 12.14 Trustee to Effectuate Subordination. Each Holder by accepting a
Subordinated Debt Security authorizes and directs the Trustee on his behalf to take such action as
may be necessary or appropriate to acknowledge or effectuate the subordination between the
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Holders of Subordinated Debt Securities and the holders of Senior Indebtedness as provided in
this Article XII and appoints the Trustee as attorney-in-fact for any and all such purposes.
Section 12.15 Trustee Not Fiduciary for Holders of Senior Indebtedness. The Trustee
shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and shall not
be liable to any such holders if it shall mistakenly pay over or distribute to Holders of
Subordinated Debt Securities or any of the Issuers or the Subsidiary Guarantors or any other
Person, money or assets to which any holders of Senior Indebtedness shall be entitled by virtue of
this Article XII or otherwise.
Section 12.16 Reliance by Holders of Senior Indebtedness on Subordination Provisions.
Each Holder by accepting a Subordinated Debt Security acknowledges and agrees that the foregoing
subordination provisions are, and are intended to be, an inducement and a consideration to each
holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before
or after the issuance of the Subordinated Debt Securities, to acquire and continue to hold, or to
continue to hold, such Senior Indebtedness and such holder of Senior Indebtedness shall be deemed
conclusively to have relied on such subordination provisions in acquiring and continuing to hold,
or in continuing to hold, such Senior Indebtedness.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 13.01 Successors and Assigns of Issuers Bound by Indenture. All the
covenants, stipulations, promises and agreements in this Indenture contained by or in behalf of the
Issuers, the Subsidiary Guarantors or the Trustee shall bind their respective successors and
assigns, whether so expressed or not.
Section 13.02 Acts of Board, Committee or Officer of Successor Issuer Valid. Any act
or proceeding by any provision of this Indenture authorized or required to be done or performed by
any board, committee or officer of either of the Issuers shall and may be done and performed with
like force and effect by the like board, committee or officer of any Successor Company.
Section 13.03 Required Notices or Demands. Any notice or communication by the
Issuers, the Subsidiary Guarantors or the Trustee to the others is duly given if in writing in the
English language and delivered in Person or mailed by registered or certified mail (return receipt
requested), telecopier or overnight air courier guaranteeing next day delivery, to the others
address:
If to the Issuers or any Subsidiary Guarantor:
Targa Resources Partners LP
1000 Louisiana, Suite 4300
Houston, Texas 77002
Attention: General Counsel
Telecopy No. (713) ___-_____
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If to the Trustee:
[ ]
The Issuers, any Subsidiary Guarantor or the Trustee by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications shall be deemed to have been duly given: at the time delivered
by hand, if personally delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; on the first Business Day on or after being sent, if telecopied and the sender
receives confirmation of successful transmission; and the next Business Day after timely delivery
to the courier, if sent by overnight air courier guaranteeing next day delivery.
Any notice required or permitted to a Holder by the Issuers, any Subsidiary Guarantor or the
Trustee pursuant to the provisions of this Indenture shall be deemed to be properly mailed by being
deposited postage prepaid in a post office letter box in the United States addressed to such Holder
at the address of such Holder as shown on the Debt Security Register. Any report pursuant to
Section 313 of the TIA shall be transmitted in compliance with subsection (c) therein.
Notwithstanding the foregoing, any notice to Holders of Floating Rate Securities regarding the
determination of a periodic rate of interest, if such notice is required pursuant to Section 2.03,
shall be sufficiently given if given in the manner specified pursuant to Section 2.03.
In the event of suspension of regular mail service or by reason of any other cause it shall be
impracticable to give notice by mail, then such notification as shall be given with the approval of
the Trustee shall constitute sufficient notice for every purpose hereunder.
In the event it shall be impracticable to give notice by publication, then such notification
as shall be given with the approval of the Trustee shall constitute sufficient notice for every
purpose hereunder.
Failure to mail a notice or communication to a Holder or any defect in it or any defect in any
notice by publication as to a Holder shall not affect the sufficiency of such notice with respect
to other Holders. If a notice or communication is mailed or published in the manner provided
above, it is conclusively presumed duly given.
Section 13.04 Indenture and Debt Securities to Be Construed in Accordance with the Laws of
the State of New York. THIS INDENTURE, EACH DEBT SECURITY AND THE GUARANTEE SHALL BE DEEMED TO
BE NEW YORK CONTRACTS, AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF SAID STATE.
Section 13.05 Officers Certificate and Opinion of Counsel to Be Furnished upon
Application or Demand by the Issuers. Upon any application or demand by the Issuers to the
Trustee to take any action under any of the provisions of this Indenture, each of the Issuers shall
furnish to the Trustee an Officers Certificate stating that all conditions precedent provided for
in
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this Indenture relating to the proposed action have been complied with and an Opinion of
Counsel stating that, in the opinion of such counsel, all such conditions precedent have been
complied with, except that in the case of any such application or demand as to which the furnishing
of such document is specifically required by any provision of this Indenture relating to such
particular application or demand, no additional certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and delivered to the Trustee with
respect to compliance with a condition or covenant provided for in this Indenture shall include (a)
a statement that the Person making such certificate or opinion has read such covenant or condition,
(b) a brief statement as to the nature and scope of the examination or investigation upon which the
statements or opinions contained in such certificate or opinion are based, (c) a statement that, in
the opinion of such Person, he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant or condition has been
complied with and (d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been complied with.
Section 13.06 Payments Due on Legal Holidays. In any case where the date of maturity
of interest on or principal of and premium, if any, on the Debt Securities of a series or the date
fixed for redemption or repayment of any Debt Security or the making of any sinking fund payment
shall not be a Business Day at any Place of Payment for the Debt Securities of such series, then
payment of interest or principal and premium, if any, or the making of such sinking fund payment
need not be made on such date at such Place of Payment, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall accrue for the period after such
date. If a record date is not a Business Day, the record date shall not be affected.
Section 13.07 Provisions Required by TIA to Control. If and to the extent that any
provision of this Indenture limits, qualifies or conflicts with another provision included in this
Indenture which is required to be included in this Indenture by any of Sections 310 to 318,
inclusive, of the TIA, such required provision shall control.
Section 13.08 Computation of Interest on Debt Securities. Interest, if any, on the
Debt Securities shall be computed on the basis of a 360-day year of twelve 30-day months, except as
may otherwise be provided pursuant to Section 2.03.
Section 13.09 Rules by Trustee, Paying Agent and Registrar. The Trustee may make
reasonable rules for action by or a meeting of Holders. The Registrar and any paying agent may
make reasonable rules for their functions.
Section 13.10 No Recourse Against Others. The General Partner and its directors,
officers, employees and members, as such, shall have no liability for any obligations of the
Subsidiary Guarantors or the Issuers under the Debt Securities, this Indenture or the Guarantee or
for any claim based on, in respect of, or by reason of, such obligations or their creation. By
accepting a Debt Security, each Holder shall be deemed to have waived and released all such
liability. The waiver and release shall be part of the consideration for the issue of the Debt
Securities.
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Section 13.11 Severability. In case any provision in this Indenture or the Debt
Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 13.12 Effect of Headings. The article and section headings herein and in the
Table of Contents are for convenience only and shall not affect the construction hereof.
Section 13.13 Indenture May Be Executed in Counterparts. This Indenture may be
executed in any number of counterparts, each of which shall be an original; but such counterparts
shall together constitute but one and the same instrument.
ARTICLE XIV
GUARANTEE
Section 14.01 Unconditional Guarantee.
(a) Notwithstanding any provision of this Article XIV to the contrary, the provisions of this
Article XIV shall be applicable only to, and inure solely to the benefit of, the Debt Securities of
any series designated, pursuant to Section 2.03, as entitled to the benefits of the Guarantee of
each of the Subsidiary Guarantors.
(b) For value received, each of the Subsidiary Guarantors hereby fully, unconditionally and
absolutely guarantees (the Guarantee) to the Holders and to the Trustee the due and punctual
payment of the principal of, and premium, if any, and interest on the Debt Securities and all other
amounts due and payable under this Indenture and the Debt Securities by the Issuers, when and as
such principal, premium, if any, and interest shall become due and payable, whether at the Stated
Maturity or by declaration of acceleration, call for redemption or otherwise, according to the
terms of the Debt Securities and this Indenture, subject to (i) the limitations set forth in
Section 14.03 and (ii) in the case of the Guarantee of the Subordinated Debt Securities, to the
subordination provisions contained in Article XII.
(c) Failing payment when due of any amount guaranteed pursuant to the Guarantee, for whatever
reason, each of the Subsidiary Guarantors will be jointly and severally obligated to pay the same
immediately, subject, in the case of the Guarantee of the Subordinated Debt Securities, to the
subordination provisions contained in Article XII. The Guarantee hereunder (other than the
Guarantee of Subordinated Debt Securities) is intended to be a general, unsecured, senior
obligation of each of the Subsidiary Guarantors and will rank pari passu in right of payment with
all Debt of each Subsidiary Guarantor that is not, by its terms, expressly subordinated in right of
payment to the Guarantee. Each of the Subsidiary Guarantors hereby agrees that its obligations
hereunder shall be full, unconditional and absolute, irrespective of the validity, regularity or
enforceability of the Debt Securities, the Guarantee (including the Guarantee of any other
Subsidiary Guarantor) or this Indenture, the absence of any action to enforce the same, any waiver
or consent by any Holder of the Debt Securities with respect to any provisions hereof or thereof,
the recovery of any judgment against either of the Issuers or any other Subsidiary Guarantor, or
any action to enforce the same or any other circumstances which might otherwise constitute a legal
or equitable discharge or defense of any of the Subsidiary Guarantors. Each of the Subsidiary
Guarantors hereby agrees that in the event of a default in
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payment of the principal of, or premium, if any, or interest on the Debt Securities, whether
at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise, legal
proceedings may be instituted by the Trustee on behalf of the Holders or, subject to Section 6.04,
by the Holders, on the terms and conditions set forth in this Indenture, directly against such
Subsidiary Guarantor to enforce the Guarantee without first proceeding against either of the
Issuers or any other Subsidiary Guarantor.
(d) The obligations of each of the Subsidiary Guarantors under this Article XIV shall be as
aforesaid full, unconditional and absolute and shall not be impaired, modified, released or limited
by any occurrence or condition whatsoever, including, without limitation, (A) any compromise,
settlement, release, waiver, renewal, extension, indulgence or modification of, or any change in,
any of the obligations and liabilities of any of the Issuers or the Subsidiary Guarantors contained
in the Debt Securities or this Indenture, (B) any impairment, modification, release or limitation
of the liability of any of the Issuers or the Subsidiary Guarantors or any of their estates in
bankruptcy, or any remedy for the enforcement thereof, resulting from the operation of any present
or future provision of any applicable Bankruptcy Law, as amended, or other statute or from the
decision of any court, (C) the assertion or exercise by any of the Issuers, the Subsidiary
Guarantors or the Trustee of any rights or remedies under the Debt Securities or this Indenture or
their delay in or failure to assert or exercise any such rights or remedies, (D) the assignment or
the purported assignment of any property as security for the Debt Securities, including all or any
part of the rights of any of the Issuers or the Subsidiary Guarantors under this Indenture, (E) the
extension of the time for payment by any of the Issuers or the Subsidiary Guarantors of any
payments or other sums or any part thereof owing or payable under any of the terms and provisions
of the Debt Securities or this Indenture or of the time for performance by any of the Issuers or
the Subsidiary Guarantors of any other obligations under or arising out of any such terms and
provisions or the extension or the renewal of any thereof, (F) the modification or amendment
(whether material or otherwise) of any duty, agreement or obligation of any of the Issuers or the
Subsidiary Guarantors set forth in this Indenture, (G) the voluntary or involuntary liquidation,
dissolution, sale or other disposition of all or substantially all of the assets, marshaling of
assets and liabilities, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of, or other similar proceeding
affecting, any of the Issuers or the Subsidiary Guarantors or any of their respective assets, or
the disaffirmance of the Debt Securities, the Guarantee or this Indenture in any such proceeding,
(H) the release or discharge of any of the Issuers or the Subsidiary Guarantors from the
performance or observance of any agreement, covenant, term or condition contained in any of such
instruments by operation of law, (I) the unenforceability of the Debt Securities, the Guarantee or
this Indenture or (J) any other circumstances (other than payment in full or discharge of all
amounts guaranteed pursuant to the Guarantee) which might otherwise constitute a legal or equitable
discharge of a surety or guarantor.
(e) Each of the Subsidiary Guarantors hereby (A) waives diligence, presentment, demand of
payment, filing of claims with a court in the event of the merger, insolvency or bankruptcy of any
of the Issuers or the Subsidiary Guarantors, and all demands whatsoever, (B) acknowledges that any
agreement, instrument or document evidencing the Guarantee may be transferred and that the benefit
of its obligations hereunder shall extend to each holder of any agreement, instrument or document
evidencing the Guarantee without notice to it and (C) covenants that the Guarantee will not be
discharged except by complete performance of the
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Guarantee. Each of the Subsidiary Guarantors further agrees that if at any time all or any
part of any payment theretofore applied by any Person to the Guarantee is, or must be, rescinded or
returned for any reason whatsoever, including without limitation, the insolvency, bankruptcy or
reorganization of any of the Issuers or the Subsidiary Guarantors, the Guarantee shall, to the
extent that such payment is or must be rescinded or returned, be deemed to have continued in
existence notwithstanding such application, and the Guarantee shall continue to be effective or be
reinstated, as the case may be, as though such application had not been made.
(f) Each of the Subsidiary Guarantors shall be subrogated to all rights of the Holders and the
Trustee against the Issuers in respect of any amounts paid by such Subsidiary Guarantor pursuant to
the provisions of this Indenture, provided, however, that such Subsidiary Guarantor, shall not be
entitled to enforce or to receive any payments arising out of, or based upon, such right of
subrogation until all of the Debt Securities and the Guarantee shall have been paid in full or
discharged.
Section 14.02 Execution and Delivery of Guarantee. To further evidence the Guarantee
set forth in Section 14.01, each of the Subsidiary Guarantors hereby agrees that a notation
relating to such Guarantee, substantially in the form attached hereto as Annex A, shall be endorsed
on each Debt Security entitled to the benefits of the Guarantee authenticated and delivered by the
Trustee and executed by either manual or facsimile signature of an Officer of such Subsidiary
Guarantor. Each of the Subsidiary Guarantors hereby agrees that the Guarantee set forth in Section
14.01 shall remain in full force and effect notwithstanding any failure to endorse on each Debt
Security a notation relating to the Guarantee. If any Officer of any Subsidiary Guarantor whose
signature is on this Indenture or a Debt Security no longer holds that office at the time the
Trustee authenticates such Debt Security or at any time thereafter, the Guarantee of such Debt
Security shall be valid nevertheless. The delivery of any Debt Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the Guarantee set forth in this
Indenture on behalf of the Subsidiary Guarantors.
The Trustee hereby accepts the trusts in this Indenture upon the terms and conditions herein
set forth.
Section 14.03 Limitation on Subsidiary Guarantors Liability. Each Subsidiary
Guarantor and by its acceptance hereof each Holder of a Debt Security entitled to the benefits of
the Guarantee hereby confirm that it is the intention of all such parties that the guarantee by
such Subsidiary Guarantor pursuant to the Guarantee not constitute a fraudulent transfer or
conveyance for purposes of any Federal or state law. To effectuate the foregoing intention, the
Holders of a Debt Security entitled to the benefits of the Guarantee and the Subsidiary Guarantors
hereby irrevocably agree that the obligations of each Subsidiary Guarantor under the Guarantee
shall be limited to the maximum amount as will, after giving effect to all other contingent and
fixed liabilities of such Subsidiary Guarantor and to any collections from or payments made by or
on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary
Guarantor under the Guarantee, not result in the obligations of such Subsidiary Guarantor under the
Guarantee constituting a fraudulent conveyance or fraudulent transfer under Federal or state law.
Section 14.04 Release of Subsidiary Guarantors from Guarantee.
-61-
(a) Notwithstanding any other provisions of this Indenture, the Guarantee of any Subsidiary
Guarantor may be released upon the terms and subject to the conditions set forth in Section
11.02(b) and in this Section 14.04. Provided that no Default shall have occurred and shall be
continuing under this Indenture, the Guarantee incurred by a Subsidiary Guarantor pursuant to this
Article XIV shall be unconditionally released and discharged (i) automatically upon (A) any sale,
exchange or transfer, whether by way of merger or otherwise, to any Person that is not an Affiliate
of the Partnership, of all of the Partnerships direct or indirect limited partnership or other
equity interests in such Subsidiary Guarantor (provided such sale, exchange or transfer is not
prohibited by this Indenture) or (B) the merger of such Subsidiary Guarantor into either of the
Issuers or any other Subsidiary Guarantor or the liquidation and dissolution of such Subsidiary
Guarantor (in each case to the extent not prohibited by this Indenture) or (ii) upon the Issuers
delivery of a written notice to the Trustee of the release or discharge of all guarantees by such
Subsidiary Guarantor of any Debt of the Issuers other than obligations arising under this Indenture
and any Debt Securities issued hereunder, except a discharge or release by or as a result of
payment under such guarantees.
(b) The Trustee shall deliver an appropriate instrument evidencing any release of a Subsidiary
Guarantor from the Guarantee upon receipt of a written request of the Issuers accompanied by an
Officers Certificate and an Opinion of Counsel to the effect that the Subsidiary Guarantor is
entitled to such release in accordance with the provisions of this Indenture. Any Subsidiary
Guarantor not so released shall remain liable for the full amount of principal of (and premium, if
any) and interest on the Debt Securities entitled to the benefits of the Guarantee as provided in
this Indenture, subject to the limitations of Section 14.03.
Section 14.05 Subsidiary Guarantor Contribution. In order to provide for just and
equitable contribution among the Subsidiary Guarantors, the Subsidiary Guarantors hereby agree,
inter se, that in the event any payment or distribution is made by any Subsidiary Guarantor (a
Funding Guarantor) under the Guarantee, such Funding Guarantor shall be entitled to a
contribution from each other Subsidiary Guarantor (if any) in a pro rata amount based on the net
assets of each Subsidiary Guarantor (including the Funding Guarantor) for all payments, damages and
expenses incurred by that Funding Guarantor in discharging the Issuers obligations with respect to
the Debt Securities or any other Subsidiary Guarantors obligations with respect to the Guarantee.
[Remainder of This Page Intentionally Left Blank.]
-62-
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, all as
of the day and year first above written.
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TARGA RESOURCES PARTNERS LP |
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TARGA RESOURCES GP LLC,
its General Partner |
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By: |
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Title: |
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[TARGA RESOURCES PARTNERS FINANCE CORP.] |
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By: |
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[NAME OF SUBSIDIARY GUARANTOR(S)] |
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[ ], as Trustee |
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[Signature Page to Subordinated Indenture]
ANNEX A
NOTATION OF GUARANTEE
Each of the Subsidiary Guarantors (which term includes any successor Person under the
Indenture), has fully, unconditionally and absolutely guaranteed, to the extent set forth in the
Indenture and subject to the provisions in the Indenture, the due and punctual payment of the
principal of, and premium, if any, and interest on the Debt Securities and all other amounts due
and payable under the Indenture and the Debt Securities by the Issuers.
The obligations of the Subsidiary Guarantors to the Holders of Debt Securities and to the
Trustee pursuant to the Guarantee and the Indenture are expressly set forth in Article XIV of the
Indenture and reference is hereby made to the Indenture for the precise terms of the Guarantee.
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[NAME OF SUBSIDIARY GUARANTOR(S)] |
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By: |
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A-1
exv5w1
Exhibit 5.1
Tel 713.758.2222 Fax 713.758.2346
April 8, 2010
Targa Resources Partners LP
1000 Louisiana, Suite 4300
Houston, Texas 77002
Ladies and Gentlemen:
We have acted as counsel for Targa Resources Partners LP, a Delaware limited partnership (the
Partnership), and certain of its subsidiaries with respect to certain legal matters in
connection with the registration under the Securities Act of 1933, as amended (the Securities
Act), of the offer and sale, from time to time, pursuant to Rule 415 under the Securities Act:
(1) by the Partnership of common units representing limited partner interests in the
Partnership (the Units);
(2) by selling unitholders to be named in a Prospectus Supplement (as defined below) from time
to time of Units; and
(3) by the Partnership of unsecured debt securities, which may either be senior or
subordinated and may be issued in one or more series, consisting of notes, debentures or other
evidences of indebtedness (the Debt Securities), and may be co-issued by Targa Resources
Partners Finance Corporation, a Delaware corporation (the Finance Corp).
The Units and Debt Securities are collectively referred to herein as the Securities.
We have also participated in the preparation of the prospectus (the Prospectus)
contained in the Registration Statement on Form S-3, as amended (the Registration
Statement), to which this opinion is an exhibit. The Securities will be offered in amounts,
at prices and on terms to be determined in light of market conditions at the time of sale and to be
set forth in supplements (each a Prospectus Supplement) to the Prospectus contained in
the Registration Statement.
In rendering the opinions set forth below, we have examined and relied upon:
(i) the Registration Statement, including the Prospectus;
|
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Vinson & Elkins LLP Attorneys at Law
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First City Tower, 1001 Fannin Street, Suite 2500 |
Abu Dhabi Austin Beijing Dallas Dubai Hong Kong Houston
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Houston, TX 77002-6760 |
London Moscow New York Palo Alto Shanghai Tokyo Washington
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Tel +1.713.758.2222 Fax +1.713.758.2346 www.velaw.com |
April 8, 2010 Page 2
(ii) the Limited Liability Company Agreement of Targa Resources GP LLC, a Delaware
limited liability company and the general partner of the Partnership (the General
Partner);
(iii) the First Amended and Restated Agreement of Limited Partnership of the Partnership,
dated as of February 14, 2007, as amended by Amendment No. 1 to First Amended and Restated
Agreement of Limited Partnership of the Partnership dated May 13, 2008;
(iv) the Bylaws of Finance Corp;
(v) the Certificate of Formation of the General Partner;
(vi) the Certificate of Limited Partnership of the Partnership;
(vii) the Certificate of Incorporation of Finance Corp;
(viii) the form of Senior Indenture filed as an exhibit to the Registration Statement (the
Senior Indenture);
(ix) the form of Subordinated Indenture filed as an exhibit to the Registration Statement (the
Subordinated Indenture and, together with the Senior Indenture, the
Indentures);
(x) resolutions of the General Partner and of Finance Corp; and
(xi) such other certificates, statutes and other instruments and documents as we consider
appropriate for purposes of the opinions hereafter expressed.
In addition, we reviewed such questions of law, as we considered appropriate.
In connection with rendering the opinions set forth below, we have assumed that:
(i) all information contained in all documents reviewed by us is true and correct;
(ii) all signatures on all documents examined by us are genuine;
(iii) all documents submitted to us as originals are authentic and all documents submitted to
us as copies conform to the originals of those documents;
April 8, 2010 Page 3
(iv) the Registration Statement, and any amendments thereto (including post-effective
amendments), will have become effective;
(v) a Prospectus Supplement will have been prepared and filed with the Securities and Exchange
Commission describing the Securities offered thereby;
(vi) all Securities will be offered and sold in compliance with applicable federal and state
securities laws and in the manner specified in the Registration Statement and the applicable
Prospectus Supplement;
(vii) the Senior Indenture will be duly authorized, executed and delivered by the parties
thereto, the Subordinated Indenture will be duly authorized, executed and delivered by the parties
thereto, and the Debt Securities will be duly authorized, executed and delivered by the parties
thereto;
(viii) a definitive purchase, underwriting or similar agreement with respect to any Securities
offered will have been duly authorized and validly executed and delivered by the Partnership and
the other parties thereto; and
(ix) any Securities issuable upon conversion, exchange or exercise of any Debt Securities
being offered will have been duly authorized, created and, if appropriate, reserved for issuance
upon such conversion, exchange or exercise.
Based on the foregoing, and subject to the assumptions, qualifications, limitations, and
exceptions set forth herein, we are of the opinion that:
1. With respect to the Units, when (i) the Partnership has taken all necessary action to
approve the issuance of the Units, the terms of the offering and related matters, (ii) any selling
unitholder, if applicable, has taken all necessary action to approve the sale of the Units, the
terms of the offering and related matters and (iii) the Units have been issued and delivered in
accordance with the terms of the applicable definitive purchase, underwriting or similar agreement
approved by the Partnership and any selling unitholder, if applicable, upon payment of the
consideration therefor provided for therein, then the Units will be validly issued, fully paid and
nonassessable.
2. With respect to the Debt Securities, when (i) the applicable Indenture relating either to
senior Debt Securities or subordinated Debt Securities has been duly qualified under the Trust
Indenture Act of 1939, as amended; (ii) the Partnership and Finance Corp, as applicable, have taken
all necessary action to approve the issuance and terms of such Debt Securities; (iii) the terms of
such Debt Securities and of their issuance and sale have been
April 8, 2010 Page 4
duly established in conformity with the applicable Indenture so as not to violate any
applicable law or result in a default under or breach of any agreement or instrument binding upon
the Partnership or Finance Corp and so as to comply with any requirements or restrictions imposed
by any court or governmental body having jurisdiction over the Partnership or Finance Corp; and
(iv) such Debt Securities have been duly executed and authenticated in accordance with the
provisions of the applicable Indenture and issued and sold as contemplated in the Registration
Statement and upon payment of the consideration as provided for in the applicable definitive
purchase, underwriting or similar agreement approved by the Partnership and Finance Corp, such Debt
Securities will be legally issued and will constitute valid and legally binding obligations of the
Partnership and Finance Corp, respectively, enforceable against the Partnership and Finance Corp in
accordance with their respective terms, except as such enforcement is subject to any applicable
bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium and similar laws relating to or affecting creditors rights generally
and to general equitable principles (regardless of whether enforcement is sought in a proceeding in
equity or at law).
We express no opinions concerning (a) the validity or enforceability of any provisions
contained in the Indentures that purport to waive or not give effect to rights to notices,
defenses, subrogation or other rights or benefits that cannot be effectively waived under
applicable law or (b) the enforceability of indemnification provisions to the extent they purport
to relate to liabilities resulting from or based upon any violation of federal or state securities
or blue sky laws.
The foregoing opinion is based on and is limited to the laws of the State of New York, the
Revised Uniform Limited Partnership Act of the State of Delaware (including the applicable
provisions of the Delaware Constitution and the reported judicial decisions interpreting these
laws) and the relevant federal laws of the United States of America, and we express no opinion as
to the effect of the laws of any other jurisdiction, domestic or foreign.
We hereby consent to the references to this firm under the caption Legal Matters in the
Prospectus and to the filing of this opinion as an exhibit to the Registration Statement. By
giving such consent, we do not admit that we are within the category of persons whose consent is
required under Section 7 of the Securities Act or the rules and regulations thereunder.
Very truly yours,
Vinson & Elkins L.L.P.
exv8w1
Exhibit 8.1
April 8, 2010
Targa Resources Partners LP
1000 Louisiana, Suite 4300
Houston, Texas 77002
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RE: |
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Targa Resources Partners LP Registration Statement on Form S-3 |
Ladies and Gentlemen:
We have acted as counsel for Targa Resources Partners LP (the Partnership), a Delaware
limited partnership, with respect to the preparation of the Registration Statement on Form S-3 (the
Registration Statement) filed on the date hereof with the Securities and Exchange Commission in
connection with the registration by the Partnership under the Securities Act of 1933, as amended
(the Securities Act), of the offer and sale (i) by certain unitholders of the Partnership of
common units in the Partnership and (ii) by the Partnership from time to time, pursuant to Rule 415
under the Securities Act, of
(1) common units representing limited partner interests in the Partnership; and
(2) debt securities, which may be issued in one or more series, consisting of notes,
debentures or other evidences of indebtedness.
We have also participated in the preparation of a Prospectus (the Prospectus) contained in
the Registration Statement to which this opinion is an exhibit. In connection therewith, we
prepared the discussion (the Discussion) set forth under the caption Material Income Tax
Consequences in the Prospectus.
All statements of legal conclusions contained in the Discussion, unless otherwise noted, are
our opinion with respect to the matters set forth therein as of the effective date of the
Prospectus, qualified by the limitations contained in the Discussion. In addition, we are of the
opinion that the Discussion with respect to those matters as to which no legal conclusions are
provided is an accurate discussion of such federal income tax matters (except for the
representations and statements of fact by the Partnership and its General Partner, included in the
Discussion, as to which we express no opinion).
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement
and to the use of our name in the Registration Statement. This consent does not constitute an
admission that we are experts within the meaning of such term as used in the Securities Act.
Very truly yours,
/s/ VINSON & ELKINS L.L.P.
Vinson & Elkins L.L.P.
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Vinson & Elkins
LLP Attorneys at
Law Austin
Beijing Dallas
Dubai Houston
London Moscow New
York Shanghai
Tokyo Washington
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First City Tower, 1001 Fannin Street, Suite 2300, Houston, TX 77002
Tel 713.758.2222 Fax 713.758.2346 www.velaw.com |
exv12w1
Exhibit 12.1
Targa Resources Partners LP
Ratio of Earning to Fixed Charges
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Years Ended December 31, |
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2009 |
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2008 |
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2007 |
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2006 |
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2005 |
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(Amounts in millions of dollars) |
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Pre-tax income (loss) from continuing operations |
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$ |
55.2 |
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$ |
52.1 |
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$ |
37.7 |
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$ |
(20.2 |
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$ |
10.4 |
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Fixed charges: |
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Interest expense and amortization of
debt issuance costs |
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95.4 |
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97.1 |
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99.4 |
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127.1 |
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27.9 |
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Capitalized interest |
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0.5 |
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0.6 |
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0.6 |
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0.4 |
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Operating lease payments |
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3.6 |
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3.8 |
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4.4 |
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2.3 |
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0.7 |
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Total fixed charges |
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99.5 |
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101.5 |
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104.4 |
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129.8 |
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28.6 |
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Amortization of capitalized interest |
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0.1 |
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0.1 |
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Equity earnings in unconsolidated investment |
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(5.0 |
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(3.9 |
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(3.5 |
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(2.7 |
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(0.4 |
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Distributions from unconsolidated investment |
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5.0 |
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4.7 |
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3.9 |
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2.3 |
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0.4 |
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Capitalized interest |
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(0.5 |
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(0.6 |
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(0.6 |
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(0.4 |
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Pre-tax income from continuing
operations plus fixed charges |
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$ |
154.3 |
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$ |
153.9 |
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$ |
141.9 |
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$ |
108.8 |
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$ |
39.0 |
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Ratio of earnings to fixed charges |
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1.6 |
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1.5 |
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1.4 |
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(1 |
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1.4 |
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Deficiency |
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$ |
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$ |
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$ |
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$ |
21.0 |
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$ |
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(1) |
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For the year ended December 31, 2006, our ratio was less than 1:1. Additional
earnings of $21.0 million would have been needed to achieve coverage of 1:1 for the year ended December 31, 2006. |
exv23w1
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of
our report dated March 3, 2010 relating to the financial statements of Targa Resources Partners LP
and the effectiveness of internal control over financial reporting, which appears in Targa
Resources Partners LPs Annual Report on Form 10-K for the year ended December 31, 2009 and our
report dated March 5, 2010, relating to the balance sheet of Targa Resources GP LLC, which appears
in Targa Resources Partners LPs Current Report on Form 8-K dated March 5, 2010. We also consent
to the reference to us under the heading Experts in such Registration Statement.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
April 8, 2010